After suffering declines in the first two months of 2022, super funds bounced back last month with a return of 1.1 per cent for the median balanced option.
SuperRatings estimated that the median growth fund rose by 1.6 per cent during March while the median capital staple option with less exposure to equity markets rose 0.1 per cent.
“It is pleasing to see performance recover over the month, as we head towards the end of the financial year,” said SuperRatings executive director Kirby Rappell.
“It has been a rockier year for super fund members, although funds seem to be navigating the uncertainty reasonably well. While many Australians feel the impact of natural disasters and increasing inflationary pressures, super continues to support improved long-term financial security for many.”
A turbulent start to the year saw the median balanced super fund decline 2.1 per cent in January and a further 0.8 per cent in February.
For the current financial year, SuperRatings estimated that the median super fund was up 2.4 per cent as of the end of March.
“I’ve said it before and I will say it again, it is important to focus on the long term when it comes to your superannuation,” said Mr Rappell.
“The rebound in performance over the March period reinforces this, if a member had switched when they saw performance fall in February, they would have locked in the loss instead of benefiting from the recovery we have now seen.”
The median balanced fund has returned 7.6 per cent over the past year, 7.5 per cent per annum during the past five years and 8.4 per cent per annum for the past decade.
SuperRatings said that only four negative financial year returns had been seen since the introduction of compulsory super.
“We are currently on track to end the 2022 financial year in positive territory, depending on how investment markets perform over the June quarter, though performance will be far more muted than that observed in FY2021,” Mr Rappell predicted.
“While it is pleasing to see performance recover over the month of March, superannuation should be viewed with a long-term lens as there will be ups and downs over shorter term periods.”
