Master trusts outperform in July

Retail master trusts outperformed industry superannuation funds in July for the 13th time in 17 months, according to research house Chant West.

The outperformance of the retail funds again reflected their heavier exposure to listed investments when compared to industry funds, many of which have strong allocations towards unlisted investments including direct property.

According to Chant West principal Warren Chant the outperformance of the master trusts was based on the recovery of both international and domestic equities in July.

Despite this, he said that industry funds continued to hold an edge over the longer term, outperforming retail master trusts by 1.3 per cent a year.

The Chant West analysis revealed that the median growth superannuation fund delivered a return of 2.2 per cent in July with the main drivers being stronger US markets and a 4.5 per cent rise in the Australian share market.

However Chant warned that superannuation fund returns still had some way to go before they recovered to the levels experienced before the global financial crisis.

“While funds have rallied 22 per cent since the end of February 2009, they still need a further 13 per cent return from here to get back to the levels of late October, 2007,” he said.

Chant said this might take some time because economic data coming out of the US indicated a subdued outlook.