The median balanced superannuation fund has returned an estimated 9.6 per cent for 2023, according to SuperRatings.
Balanced options by the research house as those investment options with 60-76 per cent in growth assets.
In December, the balanced options returned 2.8 per cent during the month but it was a year of two halves with five months reporting negative monthly returns including three consecutive months between August-October.
The firm attributed the strong result to funds managing to successfully outpace inflation and withstanding market volatility and said it is a “strong return to form” after losses of 4.8 per cent in 2022.
Gains were driven by rising technology shares in the US and strong returns for Australian shares and for cash while the only sector to report a correction was property, an asset class that hindered several funds’ 2022-23 financial year returns back in July.
Final results are expected to be released by super funds at the end of January.
Over the long term, there has been a median return of 6.5 per cent per annum since 2000 which is in line with the CPI+ 3 per cent objective and last year’s result is only the 10th highest since that year.
Executive director of SuperRatings, Kirby Rappell, said: “This year’s return follows the pattern of a strong rebound after a negative year and is expected to fully regain the 2022 losses. We have seen the benefits of fund diversification strategies over the past two years with unlisted assets supporting funds as equites fell in 2022 and the reverse observed this year. It is pleasing to see funds continue to deliver for members over the long term, continuing to build better retirement outcomes for Australians.
“The 2022 negative returns reminded members and super funds of the need to think about risk and despite the positive return story in 2023, the elevated levels of volatility over the year mean risk remains a key consideration when responding to market movements.”
