Super fund performance: Monthly returns to September 2019

In this article you can discover the latest monthly performance for super funds over 5 investment options. We’re grateful to Chant West for providing the statistics in this article.

For annual and long-term super fund performance see the following SuperGuide articles:

• Super fund performance over 27 financial years (to June 2019)
• Super fund performance over 26 calendar years (to December 2018)

After a volatile August, super funds recovered well in September to post a solid start to the 2019/20 financial year.

Returns from the median growth fund (61-80% in growth assets) grew 1.2% in September, following a -0.5% drop in August, and a 1.4% rise in July.

The net effect is a 2.0% rise for the September quarter, with local and overseas share markets providing the main boosts to growth fund performance.

Australian shares rose 2.6% and hedged international shares were up 1.5%. However, the fall in the Australian dollar (from US$0.70 to US$0.67) pushed the international shares return higher to 4.7% in unhedged terms. Among the defensive asset sectors, traditional bonds also had a strong quarter with domestic and international bonds up 2% and 2.3%, respectively on the back of falling long-term bond yields.

Chant West senior investment research manager Mano Mohankumar says: “Notwithstanding the healthy overall result over the September quarter, the volatility we encountered in August isn’t going away. We expect challenging times ahead as the global economy continues to be dogged by uncertainty. Share markets have proved resilient so far, but we anticipate more turbulence ahead in the current jittery climate.

“The trade tensions between the US and China are yet to be resolved and there is ongoing concern about the momentum of the global economy. Lacklustre growth prompted the US Federal Reserve to cut interest rates twice over the quarter, and in September the European Central Bank announced measures to stimulate a struggling economy including restarting quantitative easing. Additionally, the uncertainty surrounding Brexit remains high as prime minister Boris Johnson tries to conjure an exit deal in the runup to the 31 October deadline.

“In Australia, the Reserve Bank cut the official cash rate to a new record low of 0.75% earlier this month – the third reduction in five months. It also stated that an extended period of low interest rates will be required to further reduce unemployment and achieve a more sustainable path towards its inflation target.

“While we expect some challenging times ahead, most Australians should take comfort that their superannuation is mostly invested in well-diversified portfolios with their investments spread across a wide range of asset sectors. The typical growth fund also has more resilience built-in than it did a decade ago, so it is better prepared in the event that investment markets falter.”

Despite the recent volatility, all risk categories tracked by Chant West, from Conservative to All Growth, are ahead of their long-term return objectives over 3, 5, 7, 10 and 15 years. Those objectives range from inflation plus 2% for Conservative options to inflation plus 4.75% for High Growth options.

The following table shows the super performance across various timeframes for five investment categories.

Super fund performance (Results to 30 September 2019)

Fund Category (% Growth Assets)	1 mth (%)	3 mths (%)	FYTD (%)	1 yr (%)	3 yrs (% pa)	5 yrs (% pa)	7 yrs (% pa)	10 yrs (% pa)	15 yrs (% pa)
All Growth (96-100%)	1.7	2.4	2.4	7.5	11.2	9.5	11.5	9.0	7.8
High Growth (81-95%)	1.5	2.2	2.2	7.2	10.0	9.1	10.8	8.8	7.8
Growth (61-80%)	1.2	2.0	2.0	6.8	8.5	7.9	9.3	7.9	7.2
Balanced (41-60%)	0.7	1.6	1.6	6.1	6.6	6.5	7.5	6.7	6.2
Conservative (21-40%)	0.4	1.5	1.5	5.9	5.2	5.2	5.8	5.8	5.7

Source: Chant West

If you’re interested in the monthly performance for super funds over 5 investment options going back to July 2015, see the SuperGuide monthly super fund performance Reckoner.

If you’re interested in the performance of lifecycle super funds (including their latest returns), see the SuperGuide article What are lifecycle super funds, and how do they perform?

Learn more about super investing in the following SuperGuide articles: 

Learn more about investment performance over calendar years in the following SuperGuide articles:

Learn more about investment performance over financial years in the following SuperGuide articles: