Super funds recovering from Dec slump, but not enough

Super fund returns have continued their decent start to 2019, with returns up for the fourth consecutive month in April.

According to Chant West, the median growth fund gained 1.7 per cent for the month, following a March quarter return of 6.1 per cent. This put it firmly back in positive territory for the financial year to date, sitting at 5.2 per cent despite the slump suffered as a result of December’s share market fall.

It’s worth noting however, that growth funds, which Chant West categorises as those that are 61 – 80 per cent in growth assets, had averaged returns of nine per cent over the past nine financial years. It looked unlikely that this financial year’s returns, while in the black once again, would hit that height.

Chant West senior investment research manager, Mano Mohankumar, warned that the nine per cent strong run should be seen as the exception rather than the rule, though.

VIEW ALL

View all

“While the results over the past four months have been positive, we caution members not to get carried away. In the past week we’ve seen the re-emergence of trade tensions between the US and China, prompting a retreat in global share markets so far in May,” he said.

“And while concerns about Brexit and the pace of global economic growth may have lessened, they are still lingering at the back of investors’ minds.”

Mohankumar said that April’s strong performance came on the back an increased appetite for riskier assets, following encouraging economic data and ongoing dovishness from major central banks around the world.