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Super funds staged a miraculous recovery in the year to December 2020, after financial markets were laid low by the impact of COVID-19 earlier in the year.
After falling 12% in February/March 2020, the median Growth fund bounced back 15.5% over the remaining nine months to finish the year 3.7% higher.
That may seem anaemic when compared with the 14.7% return the previous year, but it represents the 9th consecutive positive calendar year. A feat that even the most optimistic market watchers would not have dared predict in the dire days of March.
Super fund performance: Calendar years (1993 to 2020)
The table and chart below show the annual calendar year performance of the median Growth fund over the 28 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 four negative years in the past 28, or one in every seven years on average.
| Calendar year | Return (%) |
|---|---|
| 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 positive returns in 2020 and across 5, 7, 10 and 20 years. All risk categories have also met their long-term return objectives, which typically range from CPI (a measure of inflation) +2% for Conservative funds to CPI +4.25% for All Growth. Over the past 28 years, Growth funds have returned 8.1% per year on average and the CPI has averaged 2.4% per year, giving a real return of 5.7%.
Super fund performance (Results to 31 December 2020)
| 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 | 4.1 | 7.3 | 9.0 | 8.8 | 9.0 | 6.7 |
| High Growth | 81-95 | 3.7 | 7.0 | 8.5 | 8.2 | 8.7 | 6.9 |
| Growth | 61-80 | 3.7 | 6.2 | 7.5 | 7.4 | 7.8 | 6.4 |
| Balanced | 41-60 | 3.0 | 5.0 | 5.9 | 6.0 | 6.5 | 5.5 |
| Conservative | 21-40 | 2.4 | 4.1 | 4.7 | 4.9 | 5.5 | 5.0 |
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 2019/20)
For your reference we have also included below the average super fund returns over 28 calendar years.
The table and chart below show the annual financial year performance of the median Growth fund over the 28 financial years since the introduction of compulsory super. It is inevitable that growth funds would have some years with negative returns. You would expect no more than five or six negative years over 28 years, but there have been only four.
| Financial year | Return (%) |
|---|---|
| 2019/20 | -0.5% |
| 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% |
| 1999/00 | 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 to 30 June 2020.
Super fund performance (Results to 30 June 2020)
| 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 | -2.1 | 6.2 | 6.6 | 8.9 | 8.8 | 6.8 |
| High Growth | 81-95 | -0.9 | 5.9 | 6.7 | 8.3 | 8.4 | 6.6 |
| Growth | 61-80 | -0.5 | 5.3 | 6.2 | 7.5 | 7.7 | 6.4 |
| Balanced | 41-60 | 0.3 | 4.5 | 4.8 | 6.1 | 6.4 | 5.6 |
| Conservative | 21-40 | 1.0 | 3.8 | 4.2 | 5.0 | 5.4 | 5.0 |
Source: Chant West. Performance is shown net of investment fees and tax, and before administration and adviser commissions.
