Retirement
Super funds grow in February despite tech sell-off
Super funds have continued their strong performance over the last 12 months, shaking off the market sell-off in February, new research has revealed.
Super funds grow in February despite tech sell-off
Super funds have continued their strong performance over the last 12 months, shaking off the market sell-off in February, new research has revealed.
Stats released by Chant West showed that the median growth fund (61 to 80 per cent in growth assets) returned up to 0.9 per cent in the month of February, despite the market selling down their technology-based assets.
This took total returns from the end of March 2020 to mid-March 2021 to just under 20 per cent, albeit following falls of 12.5 per cent in February 2020.
February 2021’s return was dampened by the global tech sell-off, with markets reducing their exposure to the major winners during the pandemic for value stocks.
“While there’s great optimism around the rollout of vaccines and a return to some economic normality, there were some fears that a stronger-than-expected economic recovery may result in increased inflation and fast-tracked tightening of monetary policy,” Chant West senior investment research manager Mano Mohankumar said.
According to the researcher, Australian shares still ended the month up 1.5 per cent, while international shares advanced 2.7 per cent in hedged terms. Unhedged, the gain was reduced to 1.6 per cent.
With sharemarkets rising further in the first half of March, Chant West estimates the median growth fund is up a further 2.3 per cent so far this month.
“That brings the return since the end of March last year to nearly 20 per cent, which is remarkable given the health concerns and economic damage caused by COVID-19,” Mr Mohankumar explained.
“It also means that we’re more than 5 per cent above the pre-COVID crisis high that was reached at the end of January 2020.”
The superannuation expert highlighted that the long-term performance in the superannuation sector still remains above its long-term targets.
“Since the introduction of compulsory super in 1992, the median growth fund has returned 8.1 per cent per annum.”
“Even looking at the past 20 years, which now includes three major sharemarket downturns – the ‘tech wreck’ in 2001–2003, the GFC in 2007–2009 and now COVID-19 – the median growth fund has returned 6.6 per cent pa, which is still well ahead of the typical return objective,” Mr Mohankumar concluded.
About the author
About the author
Superannuation
Aware Super takes on Australia's gender retirement gap, aiming for financial equality
Aware Super, one of Australia's largest superannuation funds with a 70 per cent female membership, is on a mission to close the gender gap that sees women retire with 30 per cent less super than men ...Read more
Superannuation
Age Pension increase prompts Australians to review their finances
The increase in the Age Pension, which takes effect today, should serve as a prompt for many older Australians to ensure they're maximizing their income as cost-of-living pressures persist, according ...Read more
Superannuation
Retirement reimagined as Australian optimism meets inflation worries in 2023 super fund insights
The latest reports on retirement confidence among Australians present a spectrum of sentiments, with fresh data revealing surprising optimism in some quarters while exposing underlying concerns in ...Read more
Superannuation
Aussie retirees face a shortfall as ideal retirement nest egg doubles what super will deliver
As Australians look towards retirement, the desired superannuation balance that many believe will ensure a comfortable retirement has significantly outpaced what they are on track to actually save. Read more
Superannuation
Super funds eye 6.5% return in 2023, despite a rocky start
As the year draws closer to its climax, Chant West unveils its projection for super funds in what can only be described as a year of economic ebbs and flows. Read more
Superannuation
A deep dive into Australia’s superannuation system
Australia has a robust retirement savings system known as superannuation designed to provide financial security to Australians in their post-work years. Read more
Superannuation
50,000 super fund members impacted by data breach
Around 50,000 member records were impacted by the breach that took place earlier this month. Read more
Superannuation
Two super funds tipped to reach $1tn by 2040
KPMG has released the findings from a new review. Read more
Superannuation
Aware Super takes on Australia's gender retirement gap, aiming for financial equality
Aware Super, one of Australia's largest superannuation funds with a 70 per cent female membership, is on a mission to close the gender gap that sees women retire with 30 per cent less super than men ...Read more
Superannuation
Age Pension increase prompts Australians to review their finances
The increase in the Age Pension, which takes effect today, should serve as a prompt for many older Australians to ensure they're maximizing their income as cost-of-living pressures persist, according ...Read more
Superannuation
Retirement reimagined as Australian optimism meets inflation worries in 2023 super fund insights
The latest reports on retirement confidence among Australians present a spectrum of sentiments, with fresh data revealing surprising optimism in some quarters while exposing underlying concerns in ...Read more
Superannuation
Aussie retirees face a shortfall as ideal retirement nest egg doubles what super will deliver
As Australians look towards retirement, the desired superannuation balance that many believe will ensure a comfortable retirement has significantly outpaced what they are on track to actually save. Read more
Superannuation
Super funds eye 6.5% return in 2023, despite a rocky start
As the year draws closer to its climax, Chant West unveils its projection for super funds in what can only be described as a year of economic ebbs and flows. Read more
Superannuation
A deep dive into Australia’s superannuation system
Australia has a robust retirement savings system known as superannuation designed to provide financial security to Australians in their post-work years. Read more
Superannuation
50,000 super fund members impacted by data breach
Around 50,000 member records were impacted by the breach that took place earlier this month. Read more
Superannuation
Two super funds tipped to reach $1tn by 2040
KPMG has released the findings from a new review. Read more