Shares and currency push strong August super returns

Superannuation funds have continued their solid start to the new financial year, with the median growth fund backing up returns of 1.1 per cent in July with a further one per cent gain in August, according to data from Chant West.

This result largely stemmed from the continued strength of listed share markets and from currency markets. Australian shares were up 1.4 per cent for the month and international shares gained 1.3 and 4.1 per cent in hedged and unhedged terms, respectively.

Considering that the average super fund has about 70 per cent of its international shares exposure unhedged, that latter number is significant.

Listed property also delivered for investors, with Australian and international REITs gaining 2.6 and 1.2 per cent, respectively.

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The research also found that a “meaningful” number of retail fund default members are now in lifecycle products, with a third of MySuper default money now being in the product. The performance of the lifecycle cohort is in the table below.

Median Retail MySuper Lifecycle Cohort Performance (results to 31 August, 2018)