SuperRatings found that the median balanced fund delivered three per cent for the month of July on the back of strong Australian and international equity markets.
“July’s one month returns for the median balanced option is an exceptional result, especially coming off the back of last financial year’s 14.7 per cent gain – the highest since the GFC,” SuperRatings founder Jeff Bresnahan said.
Chant West director Warren Chant said equity markets befitted from the US Federal Reserve, indicating it won’t pare back its bond purchasing program as well as positive corporate earnings results.
Confidence also improved, with positive data out of Europe indicating that is it “gradually emerging from recession”.
“Yet despite their recent stellar performance, Australian shares remain 4.6 per cent behind their end-October 2007 levels, while international shares are only slightly ahead, having returned 3.2 per cent in hedged terms and 5.4 per cent unhedged basis over the same period,” Mr Chant said.
“This is an important reminder that the typical growth fund is not just dependent on shares for performance.
“By diversifying across a range of growth and defensive assets, funds can capture returns from multiple sources while also spreading their risk,” Mr Chant added.
Listed property had a mixed result over July with Australian REITs down 0.7 per cent and global REITs increasing by one per cent.
Going forward, Mr Bresnahan warned that super members should to be looking long term when it comes to returns.
“Superannuation members should remain focused on the longer term to ensure that their retirement savings portfolio remains appropriate for their circumstances and goals,” Mr Bresnahan said.
“Despite the challenges of the GFC – in particular the short-term volatility in investment markets – members who resisted the urge to make short-term decisions and switch options continues to have outperformed members who have changed into cash.”
The figures were welcomed by the Industry Super Network, which noted the median industry super fund outperformed the median retail fund over rolling one, three, five, seven and 10 year periods to 31 July 2013 according to the SuperRatings Fund Credit Rate Survey. However Chant West data found master trusts outperformed industry funds in the 12 months to July by 18.8 per cent to 17.8 per cent.
This is due to the retail sector's higher allocation to shares and listed property during a strong period for growth assets, according to Chant West.
