Super funds continue FY16 shaky start
Superannuation funds had one of the toughest months since the global financial crisis (GFC), according to SuperRatings.
The research house found super funds with the median balanced option fell 2.9 per cent in August thanks to volatile investment markets.
SuperRatings founder, Jeff Bresnahan, said concerns about China's growth prospects, and falls across major stock markets contributed to the poor performance.
"While balanced funds experienced losses in August, once again, the benefits of diversification across asset classes within these portfolios was evident, with the declines well below those experienced across most major growth asset classes," Bresnahan said.
Australian markets were in free-fall, with the ASX200 Accumulation Index down 7.8 per cent in August. Australian listed property also experienced a four per cent drop for the month.
The two per cent drop in the Australian dollar against the US dollar helped offset some of the 6.5 per cent loss of the MSCI World Ex-Australia Net TR Index, and returns on international shares remained in the red.
"With further market volatility expected an ongoing concerns over global economic growth in the coming year, superannuation funds' ability to manage down-side risk will be crucial going forward," Bresnahan said.
However, SuperRating's report said despite recent market volatility taking its toll on short-term returns, long-term performance still remains strong.
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