Super funds lost further ground after a tumultuous February, but a mid-month turnaround in share markets limited the damage. The median growth fund (61 to 80% allocation to growth assets) ended up retreating just 0.4%, bringing the return over the eight months of the financial year to date to -1.6%.
Key highlights include:
There has been much attention to the share market falls in the early part of this year but members need to remember that superannuation is for the long term. The typical return objective for growth funds is to outperform inflation by 3.5% per annum over periods of five years or longer, and funds have been delivering on this promise for a very long time.
The lower return / higher volatility environment we’re currently in is likely to continue for some time given the shaky economic backdrop.
Industry funds and retail funds produced broadly similar results in February, with returns of -0.4% and -0.5% respectively.
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