Retail funds on top in October

Despite continuing market volatility, the increased exposure of retail funds to listed products has seen them once again outperform industry funds during October, according to the latest data by Chant West.

According to the Chant West, retail funds outperformed industry funds during the month with a return of 3.5 per cent versus 3.0 per cent, but with the commentary noting that industry funds continued to hold an advantage over the longer term.

The Chant West analysis for October said that fund returns had bounced back strongly following what had been an up and down September quarter with growth funds (61 to 80 per cent growth assets) up 3.2 per cent for the month.

It said this had brought the return for the first ten months of the calendar year to 6.1 per cent.

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"So with only six weeks of 2015 remaining there is a good chance that funds will deliver a fourth consecutive calendar year return," it said.

The reason for the relative outperformance of retail funds was that listed share markets, both in Australia and overseas, rebounded strongly in October, with Australian shares up 4.4 per cent and hedged international shares up eight per cent.

The Chant West analysis noted that a small rise in the Australian dollar (up from US$0.70 to US$0.71 over the month) meant that the return in unhedged terms was a little lower at 6.3 per cent.

It said listed property also had a strong month, with Australian and global REITs up 4.9 per cent and 5.6 per cent respectively.