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Despite on-again, off-again peace negotiations in the Middle East and stubbornly high inflation, financial markets shrugged off their concerns in May, giving super funds a 2.1% lift for the month.
What’s more, all risk categories – from Conservative to All Growth – are in positive territory.
With less than two weeks remaining until the end of the financial year, Chant West estimates the median growth fund will post an annual return of 9% – an excellent result given the uncertain geopolitical backdrop. If the positive sentiment holds, this would herald the fourth consecutive year of growth of 9% or more, and the 15th positive year out of the last 17.
Chant West head of superannuation investment research, Mano Mohankumar says the strong 2026 financial year performance to date has been powered by international shares, robust corporate earnings, artificial intelligence (AI) and optimism that a resolution to the US-Iran conflict is in sight.
“It also helped that all asset classes have delivered positive returns over the period with the exception of Australian REITS (real estate investment trusts), to which super funds have very little exposure.” Mohankumar says the 2026 financial year experience is yet another timely reminder of the importance of staying the course and not getting distracted by short-term market noise.
The table below shows the median performance to the end of May 2026 for the five traditional diversified risk categories.
Super fund performance (results to 31 May 2026)
| Fund category (% growth assets) | 1 mth (%) | 3 mths (%) | FYTD (%) | 1 yr (% per yr) | 3 yrs (% per yr) | 5 yrs (% per yr) | 7 yrs (% per yr) | 10 yrs (% per yr) | 15 yrs (% per yr) |
|---|---|---|---|---|---|---|---|---|---|
| All Growth (96–100%) | 3.2 | 1.3 | 10.4 | 12.7 | 13.4 | 8.6 | 9.9 | 9.8 | 9.9 |
| High Growth (81–95%) | 2.4 | 1.3 | 9.2 | 10.8 | 11.2 | 8.0 | 9.1 | 9.1 | 9.0 |
| Growth (61–80%) | 2.1 | 1.3 | 8.3 | 9.8 | 9.7 | 7.0 | 7.4 | 7.6 | 7.8 |
| Balanced (41–60%) | 1.7 | 1.1 | 6.5 | 7.8 | 7.8 | 5.6 | 5.9 | 6.1 | 6.5 |
| Conservative (21–40%) | 1.2 | 0.8 | 5.0 | 6.0 | 6.1 | 4.2 | 4.3 | 4.6 | 5.1 |
Source: Chant West. Performance is shown net of investment fees and tax, before administration fees and adviser commissions.
As you can see in the table above, returns for all periods from one to 15 years remain positive, a remarkably long positive run. And all risk categories have met their typical long-term return objectives, which range from CPI (a measure of inflation) + 1.5% for Conservative funds to CPI + 4.25% for All Growth.
The chart below shows performance of the median Growth fund since the introduction of compulsory super in July 1992. Over that period, the median Growth fund has returned 8% per year. The average annual CPI increase over the same period is 2.7%, giving a real return of 5.3% per year – well above the typical 3.5% long-term target. While the median Growth fund has delivered returns of 9.3% or more per year over the past three calendar years, Mohankumar stresses that that level of return should not be thought of as normal and urges super fund members to think long term.
Even looking at the past 20 years, which includes three major market downturns – the GFC in 2007–09, COVID in 2020, and the 2022 calendar year marked by high inflation and rising interest rates to combat it – the median Growth fund has returned 6.8% per year, comfortably ahead of the typical objective.
Growth funds have produced positive returns in 28 of the past 33 financial years. The typical risk objective for Growth funds would be no more than six negative returns during that period (there have been just five), so the risk objective has been met as well as the performance objective.
Source: Chant West
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