The median growth fund (61% to 80% in growth assets) was up 0.2% in January despite the flat performance of listed share markets which were the main drivers of growth fund performance, according to Chant West.
The research house found Australian listed shares were up 0.3% during the first month of the year, while international shares lost 0.2% and returned 0.1% in hedged and unhedged terms, respectively.
Chant West data also found that during January all growth funds returned 0.3%, high growth funds returned 0.3%, balanced funds returned 0.2%, and conservative funds returned 0.1%.
Chant West senior investment research manager, Mano Mohankumar, said: “While the January return of 0.2% represents a small uplift, share markets have picked up speed in February and we estimate that the median growth fund is up a further 2.5% so far this month. That brings the return since the end of March last year to over 18%. That’s remarkable, considering the health and economic damage wrought by COVID-19.
“In January, emerging markets outperformed developed markets despite a sell-off late in the month on concerns around a resurgence in COVID-19 cases. The US share market experienced increased volatility as a result of highly unusual and targeted trading by a segment of retail investors. This overshadowed the underlying investor optimism brought about by President Biden’s proposed stimulus plan.”