MySuper funds are set to outperform self-managed super funds (SMSFs) thanks to good overseas investment returns, according to an Investment Trends survey.
The “Investment Trends 2015 Member Sentiment and Communications Report” found the average SMSF exposure to overseas listed equities is just seven per cent of assets on average, far less than MySuper funds which have 31 per cent on average, and SMSF cash holdings are much higher (21 per cent versus four per cent).
The report said although Australian shares have provided good returns this year when dividends are taken into account they did not perform as well as the overseas markets.
“Super funds with a significant allocation to unhedged overseas assets have a very strong story due to the strong growth in overseas share markets and the decline in the Australian dollar,” the report said.
However, the survey found that members’ satisfaction declined slightly due to a lack of confidence about the future.
Investment Trends’ analyst, Irene Guiamatsia, said when super funds are able to engage their members’ interest, they are more satisfied and also more confident about the future, and there lies the opportunity.
In terms of switching, the report found one in ten members switched super funds in the past year with the clear beneficiaries of switching the new generation of retail funds that are marketed directly to banking clients.
“Existing banking relationships are, overwhelmingly, the strongest driver of the D2C [direct to client] growth, and some banks have been very successful at using their retail banking channel to grow a base of young members,” Guiamatsia said.
The report also found 20 per cent (up 16 per cent from 2014) of members using the internet said they use a smart phone or a tablet to access information from their super fund. Another 12 per cent expect to start within the next year.
