Superannuation fund rally fades as euro zone sentiment dips.

Returns for median growth superannuation funds (61 to 80 per cent in growth assets) were up for the fourth consecutive month to the end of April, but performance looks set to be tested amid mounting fears over the financial stability of Greece and the deteriorating debt problems in Europe. 

That is according to Chant West's latest multi-strategy survey, which found that as at 30 April superannuation funds in this particular growth category returned 0.4 per cent from the end of March to the end of April. Returns also rose 2.5 per cent for the full financial year to April 30.

"However, in the first half of May we have seen world markets slide on renewed fears that Greece may need to default on its debt and exit the euro zone," Chant West director Warren Chant said.

He said he estimated the median growth fund is down 3 per cent so far in May, which brings the financial year to date a negative return to -0.5 per cent.

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The report also found that high growth super funds (81 to 100 per cent in growth assets) returned 0.2 per cent from the end of March to the end of April and 1.6 per cent for the full financial year to April 30.

This compares to more conservative funds (21 to 40 per cent in growth assets) which returned 0.6 per cent month on month and 4.3 per cent over the past 12 months.

Chant said the performance of conservative funds reflects "the patchy performance of shares against bonds, which have risen in value on lower interest rates".

Reflecting Chant West's survey results, SuperRatings pointed to the deteriorating situation in Europe as a major influence on the performance of the SR50 Balanced (60 to 70 per cent) Index as at 30 April.

While the three months to the end of April saw returns on Australian balanced super options increase by 3.6 per cent, SuperRatings stated that it estimated losses since 1 May at around 3.2 per cent.