Jeff Bresnahan
Superannuation funds appear to be entering the unknown with respect to 2008, with the latest SuperRatings data suggesting that market volatility is now a key factor.
The SuperRatings data revealed a decline of 1.1 per cent in average superannuation fund returns, but noted that this was just the sixth negative monthly return recorded in the past 36 months, albeit that the ratings house suggested that returns were also likely to be in negative territory during December.
It said that there had been a further erosion of some 2.0 per cent in balanced funds’ earnings so far this month.
The SuperRatings analysis said that the outperformance of listed property trusts looks like it has come to a sudden halt, with significant losses directly impacting on Australian super funds in November and December.
It said that in November alone, the median listed property option lost more than 5 per cent — enough to put their financial year to date results in the red.
“Once the December numbers are added in, the result could look pretty ordinary,” the analysis said. “However, despite the sub-prime, property and share market doom and gloom, the median balanced option is still showing a positive result this financial year.”
SuperRatings managing director Jeff Bresnahan said the recent volatility had done nothing to affect the long-term success of many superannuation funds’ results.
The SuperRatings analysis said despite the volatility and losses, Australians have still seen their super fund accounts surge by some 75 per cent over the last five years, well ahead of the expected 35 per cent to 40 per cent that would normally be expected given current inflation rates.
According to SuperRatings, the top performing funds in terms of balanced investment options over the past five years have been MTAA Super — Balanced (up 15.4 per cent), AustralianSuper — Balanced Option (up 13.7 per cent), Telstra Super Corp Plus — Balanced (up 13.6 per cent), HostPlus — Balanced (up 13.5 per cent), Intrust Core Super — Balanced (up 13.5 per cent), Westscheme Trustee’s Selection (up 13.5 per cent), Cbus — Core Strategy (up 13.2 per cent), Catholic Super Fund Balanced (up 13.1 per cent), LUCRF Super Balanced (up 13.1 per cent) and BUSS(Q) Balanced Growth (up 13 per cent).
