Best performing pension funds: All Growth category (96–100%)

In this article you can discover the top 10 performing All Growth pension funds over 1 year and 10 years. We recommend that you also read our explanatory article Introduction to SuperGuide’s top 10 performing super fund lists which can help you understand how to compare the different risk categories that super investment options sit within. 

What is an All Growth investment option?

Investment options with a 96–100% allocation to growth assets are termed All Growth by Chant West, a research company that has been analysing super fund performance for more than 20 years.

All Growth investment options may appeal to people who want to substantially grow their super over the long term but are comfortable with the risk of major fluctuations and a negative return every so often. They are generally most appropriate for people who have at least seven years or more to invest and can use the power of time to ride out any volatility. 

Note: Investments such as shares, property, infrastructure and private equity are referred to as growth assets for their ability to produce strong returns over the long term, but they are more likely to experience volatility (and even negative returns) in shorter timeframes. Conversely, assets like cash and fixed interest are referred to as defensive assets for their ability to defend against volatility, but generally cannot produce high returns over long periods of time.  

How does an All Growth investment option behave?

In the short term, investment options in the All Growth risk category will generally be the most volatile of all risk categories. This means its capacity for high returns is generally more than all other risk categories, but it also means its capacity for downturns and more extreme negatives is more likely. 

In the long term, an All Growth investment option will generally have the capacity to grow more over longer periods than investment options in any other risk category. 

Note: We only list the top 5 investment options for All Growth pension funds because there are fewer options in this category, and to ensure that all funds highlighted performed better than the median fund.

Top 5 All Growth investment options (pension funds): 1 year to June 2020

Source: Chant West. The top 10 is limited to All Growth options with assets of $1 billion or more. Performance is shown net of investment fees and tax, and before administration and adviser commissions.

• Pension fund rankings: All Growth category (96–100%)
• Pension fund rankings: High Growth category (81–95%)
• Pension fund rankings: Growth category (61–80%)
• Pension fund rankings: Balanced category (41–60%)
• Pension fund rankings: Conservative category (21–40%)

2019/20 was a challenging financial year for superannuation and the global economy in general, and the median 1 year return for All Growth investment options across the board was -2.3%. (Median returns track the mid-point of all contenders in any one category and are good way to add context to what you’re looking at. You can see the median returns of all risk categories over a broad range of timeframes here).

Playing the long game

It’s important to keep an eye on how your pension is performing for you year to year (and interesting to see how other funds have performed), but for most people, superannuation will be the longest-held investment we ever have, and our lens on super should reflect that. 

Longer-term figures are more significant because they incorporate the ups and downs over that entire period, and allow us to see which investment managers can consistently deliver superior performance, regardless of changing external conditions. 

Top 5 All Growth investment options (pension funds): 10 years to June 2020

Source: Chant West. The top 10 is limited to All Growth options with assets of $1 billion or more. Performance is shown net of investment fees and tax, and before administration and adviser commissions.

Again median figures can provide good context. In the ten-year period to June 2020, High Growth investment options as a category delivered a median return of 9.6%. 

A small difference in performance makes a big difference over time

Although the difference between the top performer and the median may not seem that significant (1.6% per year), the difference builds up significantly over time due to compounding. We have developed the SuperGuide Super fees and returns calculator to help readers understand the difference the fees they pay and projected returns may make over time.

For example, for a 67-year-old with $500,000 in super achieving 11.2% per year, their super balance would grow to approximately $1,333,277 by age 85 (assuming 0.8% in fees and not withdrawing any super) .

All other things being equal, achieving 9.6% instead would mean a super balance of approximately $1,356,188 – a difference of $414,460 or approximately 24% less.

But don’t forget sequencing risk

When you are nearing or in retirement it is important to allow for sequencing risk, particularly if you need to draw down a significant part of your super balance. Learn more in SuperGuide article 5 ways sequencing risk affects your retirement.