Mirror, mirror… what super fund is the best-performing fund of all?

Note: SuperGuide updates this article every 6 months with the latest performance and super fund data. Discover the best ‘value for money’ super fund for 2015, the super (pre-retirement) fund of the year for 2015, and the pension (retirement) fund of the year for 2015. This article lists the top 10 performing balanced/growth super funds over 12 months to 30 June 2015, and over 5 years to 30 June 2015. This article also lists the top 10 pension balanced/growth funds over 12 months to June 2015. Latest article update was 2 September 2015.

Asking experts and rating agencies for the answer to what super fund is Australia’s best-performing fund can be compared to the vain stepmother in the fairy tale Snow White asking the magical mirror: ‘Mirror mirror on the wall, who in the land is the fairest of all?”. The answer on one day may be: “You, my queen, are fairest of all” while another day it is likely to be: “Queen, you are full fair, ’tis true, but Snow White is fairer than you.”

The dilemma when seeking out ‘the best’ is that the answer also depends on who you’re asking, what you’re asking, and even when you’re asking such a question. Do you want to know the top performer for the past month, three months, 12 months, or the top fund over a period of 3 years, 5 years, 7 years or 10 years? Are you seeking the best performer before fees, or after fees? Do you want to know the best performer after taxes have been deducted, or after both fees and taxes have been deducted?

Are you comparing like with like? For instance, a super fund investment option that invests only in cash investments will usually have a very different investment return to a super fund investment option that invests 100% of its money in Australian shares or international shares.

Alternatively, when you’re thinking of the best fund, you may be seeking a fund that provides the cheapest fees, or the best value life insurance or the most flexible pension options.

Every month, and each quarter, the daily newspapers report the top-performing super funds for the month or quarter. The data is usually sourced from one of the rating agencies, including:

  • SuperRatings
  • Chant West
  • SelectingSuper
  • MorningStar
  • Canstar

You then need to differentiate the top-performing funds from what rating agencies consider are the ‘best’ super funds. The ‘best’ super fund tag applied by a rating agency is not necessarily the super fund with the highest performance in a particular year or month, and what is ‘best’ can vary depending on what is used as a measurement.

How did your super fund perform?

In this article we publish some exciting information for those readers interested in hard data on the top all-rounder super funds, and also the winners in the investment performance stakes, courtesy of rating company, SuperRatings. Continue reading to discover the following information:

BEST VALUE FOR MONEY

  • Best value for money super fund of the year for 2015 (across both super accumulation and pension drawdown phases)
  • Top 10 ‘best value’ super funds in Australia (based on hundreds of criteria including investment, fees, insurance, service delivery) for accumulation phase, including the winning super fund
  • Top 10 ‘best value’ pension funds in Australia, including the winning pension fund

BEST-PERFORMING SUPER FUNDS AND PENSION FUNDS

  • Top 10 performing super funds (balanced investment option) for 1 year to 30 June 2015
  • Top 10 performing super fund performers (balanced investment option) for 5 years to 30 June 2015
  • Top 10 performing pension funds for 1 year to 30 June 2015

Note: If you’re seeking investment performance information only, then scroll down to the second half of this article. You can also read about the latest performance figures over 1, 3, 5, 7 and 10 years for the different investment options available, and the latest data on the top-performing super funds in the article Investment performance: We’re the best super fund. No we’re the best…

Tip: If you run a self-managed super fund (SMSF) you can use the investment returns of the large super funds as a benchmark for your own fund’s investment performance. Are you outperforming the large super funds with your asset allocation?

And the award goes to…

On 15 October 2014, ratings agency SuperRatings, announced the Super Fund of the Year for 2015 (across both accumulation phase and pension phase), and the top super fund (pre-retirement, that is, accumulation) and the top pension (retirement) fund for 2015.

SuperRatings reviewed almost 600 products (100 MySuper products, and 320 accumulation and 170 retirement products) to determine the winner.

The winner of SuperRatings’ Fund of the Year for 2015 is Telstra Super, a corporate fund, also described as a not-for-profit super fund. According to SuperRatings, in naming Telstra Super as the best fund, the rating company “looked for a fund that offered the strongest end-to-end solution, covering both the accumulation and pension phases. Areas reviewed included in-depth analysis of funds’ investments, fees, insurance, administration, advice and governance.”

SuperRatings CEO, Adam Gee said: “In a constantly changing superannuation environment, Telstra Super had an amazing year, performing consistently well across all of SuperRatings’ key assessment criteria. This includes a long history of outstanding investment returns, coupled with competitive fees.

“In addition, Telstra Super has invested heavily in administration and member education and their advice services are strongly assessed, all of which are areas that have proven challenging for a number of Telstra’s peers. While the fund is only open to employees of Telstra and their immediate families, we had to recognise its performance as a clear standout of the industry.”

The ‘best value’ super fund for 2016 will be announced in late-October 2015.

The winners for the separate awards of top super fund and top pension fund are detailed below.

Top 10 ‘best value’ super funds

SuperRatings evaluated hundreds of super funds based on hundreds of criteria (including investments; fees; insurance; service delivery; member education; financial planning facilities; employer support; and fund governance).

In alphabetical order, the top 10 finalists for top super fund (accumulation phase) for 2015 were:

  • CareSuper
  • Catholic Super
  • First State Super
  • HESTA
  • HOSTPLUS
  • QSuper
  • REST Industry Super
  • SunSuper
  • Telstra Super
  • UniSuper

And the winner is… Telstra Super, a corporate super fund looking after more than 100,000 members and managing $15.5 billion in assets.

Top 10 ‘best value’ retirement/pension funds

In alphabetical order, the top 10 pension funds (out of 170 pension products) for 2015 were:

  • AustralianSuper Choice Income
  • AUSCOAL Super Pension
  • Catholic Super Pension
  • Energy Super Income Stream
  • HOSTPLUS Pension
  • NGS Super Income Stream
  • QSuper Income Account
  • REST Pension
  • Sunsuper for Life Income Account
  • Telstra Super RetireAccess

And the winner is… REST Pension, a pension product offered by REST industry super fund – a super fund that looks after more than 1.9 million members and more than $32 billion in assets.

Investment performance: What super fund is the best performing?

If you’re looking solely at investment performance, then the ‘best’ fund award depends on what type of investment option is involved, and whether you are looking at performance over 12 months, 3 years, 5 years or even 10 years.

More than 80% of Australians have their super money invested in a balanced (sometimes described as ‘growth’) investment option, which generally involves between 60% and 80% of growth-style assets, such as shares (both international and Australian) and property, and 30% to 40% in more conservative investments, such as cash and fixed interest. Some ‘balanced’ investment options resemble ‘growth’ options, holding 80% or more of assets in growth-style investments.

For example, SuperRatings classifies a ‘balanced’ investment option to be holding 60% to 76% in growth investments while another rating agency, ChantWest, classifies ‘Balanced’ to be an investment option with 41-60% of assets in growth investments. Chant West considers an allocation of 61 to 80% in growth assets to be a ‘growth’ option.

In short, the terms ‘balanced’ and ‘growth’ are sometimes interchangeable, and you should always check the asset mix of any investment option that you’re considering or that you currently use. Your super fund’s default investment option is likely to be a balanced or growth allocation.

The three tables below, containing data sourced from SuperRatings, list the top 10-performing balanced options within super (accumulation) funds for 12-month period to 30 June 2015, and 5-year period to 30 June 2015, and top 10-performing balanced options for retirement (pension) funds for 12-month period to 30 June 2015.

Note: Displaying performance figures for different timeframes (for example, 1 year and 5 years to 30 June 2015) highlights the fact that a particular super fund may be the top performer in one period and further down the performance list in another period.

The key when measuring the performance of a super fund is consistent long-term returns over extended periods which means the best long-term performer over longer periods may not necessarily be the best performer in any one or more periods.

Best-performing super funds

Super funds — Top 10 performers for 1 year to 30 June 2015

According to SuperRatings, the best-performing super funds based on the ‘balanced’ option (investment options with between 60% and 76% in growth-style assets) over the 1-year period ending 30 June 2015 are:

Table 1. Super Funds: Top 10 Balanced (60-76) options for 1 year as at 30 June 2015
Fund Investment Option Option Type Return Period Return (% p.a.) Rank
CSC PSSap — MySuper Balanced Balanced (60-76) 1 year 12.2% 1
MTAA Super — My AutoSuper Balanced (60-76) 1 year 11.7% 2
Intrust Core Super — Balanced Balanced (60-76) 1 year 11.1% 3
AMP FLS — AMP Balanced Growth Balanced (60-76) 1 year 11.0% 4
UniSuper — Balanced Balanced (60-76) 1 year 11.0% 4
HOSTPLUS — Balanced Balanced (60-76) 1 year 11.0% 4
AustralianSuper — Balanced Balanced (60-76) 1 year 10.9% 7
CareSuper — Balanced Balanced (60-76) 1 year 10.8% 8
AustSafe Super — MySuper (Balanced) Balanced (60-76) 1 year 10.7% 9
Russell SS Emp — Russell Balanced Portfolio Balanced (60-76) 1 year 10.5% 10

Table note: All results are net of fees and tax and are for the 1 year ended 30 June 2015. Past performance is not a reliable indicator of future performance.

Source: SuperRatings

Note: If you have actively chosen an investment option, then your super money may not be in a balanced investment option. You will need to do a little more research to uncover the performance data for super funds that have invested in a similar asset allocation to yourself.

Super funds — Top 10 performers for 5 years to 30 June 2015

According to SuperRatings, the best-performing super funds based on the ‘balanced’ option (investment options with between 60% and 76% in growth-style assets) over the 5-year period ending 30 June 2015 are:

Table 2. Super Funds: Top 10 Balanced (60-76) options for 5 years as at 30 June 2015
Fund Investment Option Option Type Return Period Return (% p.a.) Rank
Super SA Triple S — Growth Balanced (60-76) 5 year 10.84% 1
VicSuper FutureSaver — Growth (MySuper) Option Balanced (60-76) 5 year 10.59% 2
Telstra Super Corp Plus — Balanced Balanced (60-76) 5 year 10.50% 3
Super SA Triple S — Balanced Balanced (60-76) 5 year 10.32% 4
CareSuper — Balanced Balanced (60-76) 5 year 10.31% 5
HOSTPLUS — Balanced Balanced (60-76) 5 year 10.28% 6
AustralianSuper — Balanced Balanced (60-76) 5 year 10.20% 7
Kinetic Super — Growth Balanced (60-76) 5 year 10.19% 8
REST — Core Strategy Balanced (60-76) 5 year 10.17% 9
UniSuper Accum (1) — Balanced Balanced (60-76) 5 year 10.16% 10

Table note: All results are net of fees and tax and are for the 5 years ended 30 June 2015. Past performance is not a reliable indicator of future performance.

Source: SuperRatings 

Best-performing pension funds

Pension funds — Top 10 performers for 1 year to 30 June 2015

According to SuperRatings, the best-performing pension funds based on the ‘balanced’ option (investment options with between 60% and 76% in growth-style assets) over the 1-year period ending 30 June 2015 are:

Table 3. Pension Funds: Top 10 Balanced (60-76) options for 1 year as at 30 June 2015
Fund Investment Option Option Type Return Period Return (% p.a.) Rank
MTAA Super AP — Balanced Balanced (60-76) 1 year 13.1% 1
AustralianSuper Choice Income Account — Balanced Balanced (60-76) 1 year 12.6% 2
UniSuper AP — Balanced Balanced (60-76) 1 year 12.4% 3
HOSTPLUS AP — Balanced Balanced (60-76) 1 year 12.3% 4
AMP FL AP — AMP Balanced Growth Balanced (60-76) 1 year 11.8% 5
AON MT Corp Ess AP — Balanced Growth — Active Balanced (60-76) 1 year 11.8% 5
CareSuper AP — Balanced Balanced (60-76) 1 year 11.6% 7
Equip AP — Balanced Growth Balanced (60-76) 1 year 11.4% 8
Suncorp WealthSmart AP — Suncorp Growth Portfolio Balanced (60-76) 1 year 11.3% 9
Cbus AP — Growth Balanced (60-76) 1 year 11.2% 10

Table note: All results are net of fees and tax and are for the 1 year ended 30 June 2015. Past performance is not a reliable indicator of future performance.

Source: SuperRatings

Note: If you have actively chosen an investment option, then your super pension money may not be in a balanced investment option. You will need to do a little more research to uncover the performance data for super funds that have invested in a similar asset allocation to yourself.


IMPORTANT: SuperGuide does not provide financial advice. SuperGuide does not answer all questions posted in the comments section. SuperGuide may use your question or comment, or use questions from several readers, as the basis for an article topic that we publish on the SuperGuide website. We will not disclose names or personal information in these articles. Comments provided by readers that may include information relating to tax, superannuation or other rules cannot be relied upon as advice. SuperGuide does not verify the information provided within comments from readers. Readers need to seek independent advice about their personal circumstances.

Comments

  1. ruth fehring says:

    My supers are everywhere. have rolled over one and trying to redirect two others. lm ten years from retirement. working at the moment.A accumulating funds for now. lve read and written notes.

    gee, so much to take in, in relation to fees,IFA,TPD or ddd and so on.
    l work hours, fund needs growth, low fees . lve been wanting to make extra payments to a supper fund.

    please help to advise and whom to trust with a person super.
    how do l see to make this simple, lm not a super fund adviser but need direction.
    l have enjoyed the pervious comments of others seeking direction.

    kindest regards ruth

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