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Super funds surpassed expectations in the year to December 2023. Against a backdrop of challenging economic conditions and geopolitical tensions, with high market volatility, the median Growth fund returned 9.9%.
This more than made up for the 4.6% loss the previous calendar year and represents the 11th positive return in the past 12 years.
Chant West senior research manager, Mano Mohankumar says the 2023 result is a reward for fund members who have remained patient and maintained a long-term focus.
“That patience has certainly been tested at various points over the past four years, a period over which super funds’ investment portfolios have proven their resilience and robustness.
“They’ve shown their ability to limit the damage during periods of share market weakness, as we saw during the COVID crisis in early 2020 and again in 2022 when we saw rapidly rising inflation combatted by central banks aggressively hiking interest rates. At the same time, they’re able to still capture a meaningful proportion of the upswing when markets perform strongly, as we saw this past year.”
Super fund performance: Calendar years (1993 to 2023)
For your reference, the table and chart below show the annual calendar year performance of the median Growth fund over the 31 years since the introduction of compulsory super.
Growth funds typically aim to post no more than one negative return every five years. As it happens, they have had only five negative years in the past 31, or one in every six years on average.
Calendar year | Return (%) |
---|---|
2023 | 9.9% |
2022 | -4.6% |
2021 | 13.4% |
2020 | 3.7% |
2019 | 14.7% |
2018 | 0.8% |
2017 | 10.8% |
2016 | 7.5% |
2015 | 5.7% |
2014 | 8.5% |
2013 | 17.2% |
2012 | 12.8% |
2011 | -1.9% |
2010 | 4.7% |
2009 | 15.1% |
2008 | -21.5% |
2007 | 8% |
2006 | 13.8% |
2005 | 14.3% |
2004 | 15.5% |
2003 | 9.2% |
2002 | -4.8% |
2001 | 4% |
2000 | 7.3% |
1999 | 10.2% |
1998 | 11% |
1997 | 14.9% |
1996 | 10.8% |
1995 | 16.1% |
1994 | -3.9% |
1993 | 23.9% |
Source: Chant West. Performance is shown net of investment fees and tax, and before administration and adviser commissions.
The following table shows the super performance across various timeframes for five investment categories as at the end of the last calendar year.
As you can see, all five traditional risk categories posted positve returns in 2023 and were overwhelmingly positive over 3, 5, 7, 10 and 15 years.
All risk categories have also met their long-term return objectives, which typically range from CPI (a measure of inflation) +1.75% per year for Conservative funds, to CPI +4.25% for All Growth funds. Over the past 31 years, the median Growth fund has returned 7.9% per year on average and the annual CPI increase is 2.7%, giving a real return of 5.2% – well above the typical return objective for Growth funds of CPI +3.5%.
Super fund performance (results to 31 December 2023)
Fund category (% growth assets) | 1 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%) | 13.1 | 8.0 | 9.9 | 8.7 | 8.5 | 9.4 |
High Growth (81–95%) | 11.4 | 7.1 | 8.9 | 8.1 | 8.1 | 8.7 |
Growth (61–80%) | 9.9 | 5.9 | 7.3 | 6.9 | 7.0 | 7.8 |
Balanced (41–60%) | 8.1 | 4.4 | 5.7 | 5.4 | 5.6 | 6.5 |
Conservative (21–40%) | 6.2 | 3.1 | 4.0 | 4.0 | 4.4 | 5.3 |
Source: Chant West. Performance is shown net of investment fees and tax, and before administration and adviser commissions.
Super fund performance: Financial years (1992–93 to 2022-23)
The table and chart below show the annual financial year performance of the median Growth fund over the 31 financial years since the introduction of compulsory super.
In the year to June 2023, the median Growth returned 9.2%, the 12th positive return in 14 years and well ahead of the typical long-term objective of around 6% per year. Growth funds typically aim to post no more than one negative return every five years, which translates to six negative years over the past 31. As it happens, they have had only five.
Financial year | Return (%) |
---|---|
2022-23 | 9.2% |
2021–22 | -3.3% |
2020–21 | 18.0% |
2019–20 | -0.6% |
2018–19 | 7.0% |
2017–18 | 9.4% |
2016–17 | 10.8% |
2015–16 | 3.0% |
2014–15 | 9.8% |
2013–14 | 12.8% |
2012–13 | 15.6% |
2011–12 | 0.5% |
2010–11 | 9.2% |
2009–10 | 10.4% |
2008–09 | -12.9% |
2007–08 | -6.9% |
2006–07 | 15.6% |
2005–06 | 14.7% |
2004–05 | 13.1% |
2003–04 | 13.5% |
2002–03 | 0.3% |
2001–02 | -3.3% |
2000–01 | 6.0% |
1999–2000 | 12.7% |
1998–99 | 8.6% |
1997–98 | 10.0% |
1996–97 | 19.4% |
1995–96 | 10.7% |
1994–95 | 7.4% |
1993–94 | 7.1% |
1992–93 | 11.4% |
Source: Chant West. Performance is shown net of investment fees and tax, and before administration and adviser commissions.
The following table shows the super performance across various timeframes for five investment categories as at the end of the latest financial year.
As you can see, all five risk categories posted positive returns in 2022-23, and returns were also positive across all timeframes from one to 15 years. All risk categories have also met their long-term return objectives, which typically range from CPI (a measure of inflation) +1.5% for Conservative funds and CPI+3.5% for Growth funds to CPI +4.25% for All Growth. Over the past 31 years, Growth funds have returned 7.8% per year on average and the annual CPI increase is 2.7%, giving a real return of 5.1%, well above their 3.5% target.
Super fund performance (results to 30 June 2023)
Fund category (% growth assets) | 1 yr (%) | 2 yrs (% 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%) | 12.4 | 3.4 | 10.8 | 7.5 | 9.2 | 9.4 | 7.2 |
High Growth (81–95%) | 11.5 | 3.3 | 9.5 | 7.1 | 8.5 | 8.8 | 7.1 |
Growth (61–80%) | 9.2 | 2.7 | 7.5 | 5.8 | 7.0 | 7.5 | 6.4 |
Balanced (41–60%) | 6.9 | 2.2 | 5.4 | 4.6 | 5.4 | 6.0 | 5.6 |
Conservative (21–40%) | 4.6 | 1.3 | 3.2 | 3.3 | 3.9 | 4.5 | 4.8 |
Source: Chant West. Performance is shown net of investment fees and tax, and before administration and adviser commissions.
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