POWERED BY MOMENTUM MEDIA
Super funds aim to break 24-year record
Growth super funds (as defined by 61% to 80% in growth assets) are set to achieve the highest end of financial year return in 24 years, according to data from Chant West.
The median growth fund returned 1.1% in May, with a 15.7% return for the first 11 months of the financial year.
With markets up in June, it was expected the end financial year cumulative return would finish at around 17.5%
Mano Mohankumar, Chant West senior investment research manager, said that super fund members who held their nerve and remained patient through the COVID-19 crisis were rewarded with one of the strongest years in the compulsory super era.
“Should growth funds finish the year at or around the current level, it would represent the highest annual return in 24 years,” Mohankumar said.
“The last time we saw a higher annual result was all the way back in 1996/97 when growth funds returned 19.4%.”
Mohankumar said the past two financial years illustrated the strength and resilience of the leading super funds.
“Despite the massive hit that COVID-19 delivered to financial markets last year, the diversification built into growth funds enabled them to limit the damage, and the small loss of 0.6% for FY20 was far better than expected,” Mohankumar said.
“And this year, with a little over 50% allocated to listed shares, these funds have been able to capture a meaningful proportion of the upside as markets staged their remarkable recovery.
“The cumulative return since the COVID-19 low point at end-March last year is now about 25%, which is amazing given the chaos the world was thrown into by COVID-19.
“We’re now sitting about 10% above the pre-COVID crisis high that was reached at the end of January 2020.”
Traditional diversified fund performance to 31 May 2021
Source: Chant West
Recommended for you
The lower outlook for inflation has set the stage for another two rate cuts over the first half of 2026, according to Westpac.
With private asset valuations emerging as a key concern for both regulators and the broader market, Apollo Global Management has called on the corporate regulator to issue clear principles on valuation practices, including guidance on the disclosures it expects from market participants.
Institutional asset owners are largely rethinking their exposure to the US, with private markets increasingly being viewed as a strategic investment allocation, new research has shown.
Australia’s corporate regulator has been told it must quickly modernise its oversight of private markets, after being caught off guard by the complexity, size, and opacity of the asset class now dominating institutional portfolios.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
92.15 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
53.24 3 y p.a(%)
3
Global X GlobalX FANG+ ETF
43.15 3 y p.a(%)
4
DomaCom Shoreline North Coogee
36.26 3 y p.a(%)
5
GAM LSA Private Shares AU I
35.87 3 y p.a(%)
