The median growth superannuation fund dropped 0.2 per cent in November due to negative share returns both locally and overseas, but a rebound in December pointed to a positive outlook for 2011, according to research house Chant West.
The median growth fund gained 5.6 per cent from July 1 last year to mid December, despite pulling back slightly in November over renewed concerns about European debt and China’s latest move to kerb inflation, said Chant West principal Warren Chant.
The bullish sentiment returned in December, with both domestic and international markets performing strongly, meaning the median growth fund ended up returning 7 per cent for the half-year from 1 July, according to Chant West figures.
Industry funds have a lower weighting to listed shares compared to master trusts, which led to a slightly better performance through the November downturn. Industry funds slipped 0.1 per cent compared to a drop of 0.4 per cent for master trusts in the month.
Over 10 years to the end of November 2010, industry funds outperformed master trusts by 1.3 per cent per annum, returning an annualised 5.8 per cent against 4.5 per cent, according to Chant West figures.
The two funds have announced the signing of a non-binding MOU to explore a potential merger.
The board must shift its focus from managing inflation to stimulating the economy with the trimmed mean inflation figure edging closer to the 2.5 per cent target, economists have said.
ASIC chair Joe Longo says superannuation trustees must do more to protect members from misconduct and high-risk schemes.
Super fund mergers are rising, but poor planning during successor fund transfers has left members and employers exposed to serious risks.