Super funds gain 9.2% for 2017/2018 financial year

Note: This article provides comprehensive investment performance data for the 2017/2018 financial year, and for the previous 8 financial years. You can discover the performance results for the most popular superannuation fund investment option (Growth: 61-80% in growth assets), and also the performance results for the other 4 main investment options – All Growth (100% in growth assets), High Growth (81-100% in growth assets), Balanced (41-60% in growth assets) and Conservative (21-40% in growth assets, according to superannuation ratings agency, Chant West. (For investment performance figures for the latest calendar year, see SuperGuide article Super funds return 10.8% for 2017 calendar year.)

The median superannuation growth investment option gained 9.2% in value for the 12 months to 30 June 2018, and the median growth investment option had a 1.2% return for the month of June 2018, according to superannuation ratings agency, Chant West. A return for the growth investment option of the median fund is simply choosing the return for the fund in the middle of the list of super funds.

The investment performance result for the 2017/2018 financial year means the median growth superannuation fund has delivered a positive return for the ninth consecutive positive financial year. For investment returns over 1 year, 3, 5, 7, 10 and 15 years to 30 June 2018 for 5 main investment options, see Table 1, later in the article. (For more details on the median growth investment option, including the 9 consecutive positive returns, see Table 4 later in the article).

See Tables 2 to 6, later in the article, for investment returns spanning 9 financial years (from 2009/2010 year to 2017/2018 year) for the 5 investment options (All Growth, High Growth, Growth, Balanced and Conservative).

Note: For an explanation of a growth investment option, a balanced investment option, and a default investment option, and the other main types of investment options see SuperGuide article Superannuation investment: What is the difference between a balanced and growth option?

Quick access to investment performance tables

If you’re interested in checking out the performance tables before reading the article, just click on the relevant link below to access the performance table that interests you.

• Table 1: Summary performance to 30 June 2018: For 5 main superannuation investment options over 1 year, and 3, 5, 7, 10 and 15 years
• Table 2: All Growth (100% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 3: High Growth (81-100% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 4: Growth (61-80% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 5: Balanced (41-60% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 6: Conservative (21-40% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years

Note: Each month, we also report on the monthly investment performance of superannuation funds. For the latest monthly returns for the 5 main types of superannuation investment options (including month-by-month data for each investment option going back to January 2014, through to the latest monthly returns), see SuperGuide article Investment performance: Latest monthly super returns (to June 2018).

Note: Over the 12 months to 30 June 2018, the median industry super fund delivered a 10.3% return while the median retail super fund delivered a return of 9.0%, which works out to be a significant 1.3% difference in returns for the year. For more information on the performance of industry funds compared to retail super funds, see SuperGuide article Industry funds outperform retail funds for 2017/2018 year, and longer term.

Investment review of 2017/2018 financial year

According to Mano Mohankumar, senior investment manager at, the 2017/2018 financial year turned out to be another excellent year for super fund members: “…The median growth fund finished the year up a very healthy 9.2% – a record-equalling ninth consecutive positive year and well ahead of the funds’ own performance targets… Every fund in our growth category easily bettered the rate of inflation, and even the lowest performer delivered a respectable 6.5%.

“The only other time we’ve seen such a long sequence of positive returns was from 1992/1993 to 2000/2001… It’s also well ahead of the typical long-term return objective for the growth category which is CPI + 3.5%. With inflation running at about 2%, that translates to a target of about 5.5%.

Mohankumar believes that shares are still the main drivers of performance, but the major funds are well diversified across other asset sectors as well. He says: “The better performing funds in 2017/2018 were those that had higher allocations to listed shares and to unlisted assets – property, infrastructure and private equity. A lower exposure to traditional bonds and cash also greatly helped, given they were the worst performing sectors.”

Note: The majority of international share investments held in super funds are unhedged. Briefly, when a super fund fully hedges your international investments against movements in the Australian dollar or foreign currency, your investment return is solely based on the merits of the investment rather than the strength or otherwise of the Australian dollar. For more information about hedged and unhedged international shares, see SuperGuide article Revisited: Ban unhedged international shares in default investment options.

Performance tables to 30 June 2018, for the 5 main investment options offered by super funds, including investment returns spanning up to 15 years are set out in Table 1 later in the article. For more detailed data on investment returns for the 5 main investment options over the past 9 financial years, see Tables 2 to 6 later in the article.

Long-term return of 8.3%, over 26 years

According to Chant West, since the introduction of compulsory 26 years ago, the median growth fund (61-80% in growth assets) has delivered an average annual return of 8.3% to the end of the 2017/2018 financial year (30 June 2018). With the long-term annual CPI (inflation) increasing by 2.5% a year, the long-term return after inflation is 5.8% a year, which is ahead of the typical return objective, to beat inflation by 3% or 4% a year.

Note: Another superannuation ratings agency, SuperRatings, uses a slightly different definition (60-76% in growth assets) for the median growth fund compared with Chant West, and uses the term ‘balanced’ to describe such an option. For more information on the 25-year performance based on SuperRatings data, see SuperGuide article Investment performance: 26 years of SG delivers 7.5% a year.

Financial year performance: The median growth superannuation fund has delivered a positive return for each of the past 9 financial years, and according to SuperGuide calculations, translates into an average annual return of 9.03%. Chant West has previously outlined the performance for median growth super funds for the past 9 financial years as follows:

• 9.2% for 2017/2018 year
• 10.8% for 2016/2017 year
• 3.0% for 2015/2016 year
• 9.8% for 2014/2015 year
• 12.8% for 2013/2014 year
• 15.6% for 2012/2013 year
• 0.5% for 2011/2012 year
• 9.2% for 2010/2011 year
• 10.4% for 2009/2010 year.

Note: For more details on the median growth option performance figures, see Table 2 below, and for the performance figures for the other 4 main investment options, see Tables 3 to 6 later in the article.

Reminder: A financial year runs from 1 July to 30 June of the following year. A calendar year runs from 1 January through to 31 December.

Calendar year performance: Looking back at super fund returns, the median growth superannuation fund has a delivered a positive return for each of the past 5 calendar years, and according to SuperGuide calculations, translates into an average annual return for that 5-year period of 10.4% (7.7% for 2016 calendar year, 5.8% for 2015, 8.5% for 2014, 17.2% for 2013, and 12.8% for 2012). For more information on the investment returns for the latest calendar year (and previous 6 calendar years), see SuperGuide article Super funds return 10.8% for 2017 calendar year.

Summary: 2017/2018 year performance for 5 main investment options

Table 1 below lists the performance figures for the five main asset allocations for: 1 month, 3 months, 1 year, 3 years, 5 years, 7 years, 10 years, and 15 years to 30 June 2018.

Assessing 1-month returns: Over the 1-month period to 30 June 2018, the 5 main investment options delivered positive returns: All Growth (1.6%), High Growth (1.4%), Growth (1.2%), Balanced (1.0%), and Conservative (0.7%). Performance over one month is not particularly significant, compared with the significance of the 10-year and 15-year performance (see later in this section).

Monitoring 3-month returns: For the 3 months to 30 June 2018, all 5 investment options gained in value: the top performer was the All Growth option with a 5.0% gain in value, followed by the High Growth option (4.1% gain in value), and then the Growth option which gained 3.3% in value over the same timeframe. The Balanced option gained 2.4% in value over the 3 months to June 2018, while the Conservative option gained 1.7% in value.

Returns for the 2017/2018 year: The highest risk option, All Growth option (12.5%), outperformed all other investment options over the financial year, followed by the High Growth option (11.4%), and then the Growth option, which gained 9.2% in value for the 12 months to June 2018. The median Balanced option gained 7.0% in value, while the Conservative option gained 5.0% in value for the 12 months to June 2018.

Performance over 3 years: The median All Growth option outperformed other investment options over 3 years to 30 June 2018 (9.1%), followed by the High Growth option (8.9%), and then the Growth option (7.4%). The Balanced option gained 6.2% in value over the 3 years to June 2018, and followed by the Conservative option (4.8%).

Performance over 5 years: The median All Growth option outperformed other investment options over 5 years to 30 June 2018 (11.3%), followed by the High Growth option (10.6%), the Growth option (9.1%), and then the Balanced option (7.3%), and the Conservative option (5.6%).

Performance over 7 years: The median All Growth fund (10.4%) outperformed the High Growth option (9.8%), followed by the Growth option (8.7%), and then the Balanced option (7.1%), and the Conservative option (5.8%).

Performance over 10 years: Over 10 years to 30 June 2018, the All Growth option delivered the highest average annual return (7.1%) of the five asset allocations, followed by the High Growth option (6.9%), then the Growth option (6.6%), the Balanced option (5.9%) and the Conservative option (5.3%).

Performance over 15 years: Over the 15-year period to 30 June 2018, the All Growth option delivered the highest average annual return (8.4%), followed by the High Growth option (8.2%), then the Growth option (7.8%), the Balanced option (6.6%) and the Conservative option (6.0%).

According to previous commentary from Chant West, the performance figures for the 10-year period and 15-year had been weighed down by the ‘GFC effect’, although the returns to 30 June 2018 appear to have recovered from the long-term effects of the GFC. are gradually improving. The 5-year and 7-year returns reflect the strong performance of listed shares and property, which means the investment options with a higher proportion of growth assets have performed better over these timeframes.

Table 1: Summary investment performance for median growth option to 30 June 2018

Fund Category	Growth Assets (%)	1 mth (%)	3 mths (%)	1 Yr (%)	3 Yrs (% pa)	5 Yrs (% pa)	7 Yrs (% pa)	10 Yrs (% pa)	15 Yrs (% pa)
All Growth	100	1.6	5.0	12.5	9.1	11.3	10.4	7.1	8.4
High Growth	81 – 100	1.4	4.1	11.4	8.9	10.6	9.8	6.9	8.2
Growth	61 – 80	1.2	3.3	9.2	7.4	9.1	8.7	6.6	7.8
Balanced	41 – 60	1.0	2.4	7.0	6.2	7.3	7.1	5.9	6.6
Conservative	21 – 40	0.7	1.7	5.0	4.8	5.6	5.8	5.3	6.0

Note: Performance is shown net of investment fees and tax. It does not include administration fees or adviser commissions.

Source: Chant West 19 July 2018 media release (www.chantwest.com.au), and subsequent information provided by Chant West.

For more detailed investment performance information about the 5 main options over the past 9 financial years, see Tables 2 to 6 below.

Reminder: A financial year runs from 1 July to 30 June of the following year. A calendar year runs from 1 January through to 31 December.

Tables 2 to 6: Investment performance data for 5 main investment options over 9 financial years

Set out below is annual performance data for the 5 main investment options (All Growth, High Growth, Growth, Balanced, Conservative) for the past 8 financial years, looking at 1 year, and 5, 7 and 10-year performance to 30 June:

• Table 2: All Growth (100% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 3: High Growth (81-100% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 4: Growth (61-80% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 5: Balanced (41-60% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years
• Table 6: Conservative (21-40% growth assets) option: Investment performance from 2017/2018 year back to 2009/2010 year, over 1 year, and 5, 7 and 10 years

For more information about the latest financial year (and previous years) investment performance figures for Australian super funds, see the following SuperGuide articles:

• Top 10 performing super funds for 2017/2018 financial year (and previous years)
• Asset classes: Naming the investment winners for the 2017/2018 financial year (and previous years)
• Investment performance: 26 years of SG delivers 7.5% a year
• Investment performance: Latest monthly super returns (to June 2018)
• Industry funds outperform retail funds for 2017/2018 year, and longer term

For information about the latest calendar year (and previous years) investment performance figures for Australian super funds, see the following SuperGuide articles:

• Super funds return 10.8% for 2017 calendar year
• Top 10 performing super funds for 2017 calendar year (and previous years)
• Asset classes: Naming the investment winners for the 2017 calendar year (and previous years)
• Investment performance: Latest monthly super returns (to June 2018)
• Industry funds outperform retail funds for 2017 calendar year, and longer term

Table 2: All Growth (100%) investment performance over 9 financial years

Financial year	1 year to 30 June:	5 years (p.a.) to 30 June:	7 years (p.a.) to 30 June:	10 years (p.a.) to 30 June:
2017/2018	12.5%	11.3%	10.4%	7.1%
2016/2017	14.8%	12.9%	10.2%	4.4%
2015/2016	0.2%	9.2%	9.6%	4.8%
2014/2015	12.4%	11.2%	6.3%	6.6%
2013/2014	16.8%	10.9%	2.5%	6.7%
2012/2013	20.9%	3.2%	2.7%	6.8%
2011/2012	-2.5%	-3.3%	2.5%	4.4%
2010/2011	10.4%	0.5%	4.9%	3.3%
2009/2010	10.9%	2.2%	6.1%	3.0%

Note: Performance is shown net of investment fees and tax. It does not include administration fees or adviser commissions.

Source: Chant West media releases over the past 9 years (www.chantwest.com.au), and subsequent information provided by Chant West.

Table 3: High Growth (81-100%) investment performance over 9 financial years

Financial year	1 year to 30 June:	5 years (p.a.) to 30 June:	7 years (p.a.) to 30 June:	10 years (p.a.) to 30 June:
2017/2018	11.4%	10.6%	9.8%	6.9%
2016/2017	12.8%	11.8%	9.6%	4.7%
2015/2016	2.8%	9.0%	9.4%	5.2%
2014/2015	11.3%	10.6%	6.4%	6.7%
2013/2014	14.9%	10.5%	3.2%	6.9%
2012/2013	18.4%	3.9%	3.5%	7.1%
2011/2012	-1.0%	-1.9%	3.4%	4.9%
2010/2011	10.0%	1.3%	5.3%	4.4%
2009/2010	11.1%	2.9%	6.2%	4.0%

Note: Performance is shown net of investment fees and tax. It does not include administration fees or adviser commissions.

Source: Chant West media releases over the past 9 years (www.chantwest.com.au), and subsequent information provided by Chant West.

Table 4: Growth (61-80%) investment performance over 9 financial years

Financial year	1 year to 30 June:	5 years (p.a.) to 30 June:	7 years (p.a.) to 30 June:	10 years (p.a.) to 30 June:
2017/2018	9.2%	9.1%	8.7%	6.6%
2016/2017	10.8%	10.4%	8.8%	5.1%
2015/2016	3.0%	8.2%	8.8%	5.3%
2014/2015	9.8%	9.6%	6.2%	6.6%
2013/2014	12.8%	9.6%	3.7%	6.9%
2012/2013	15.6%	4.1%	4.1%	7.0%
2011/2012	0.5%	-0.1%	4.0%	5.4%
2010/2011	9.2%	2.3%	5.6%	4.9%
2009/2010	10.4%	3.7%	6.4%	4.6%

Note: Performance is shown net of investment fees and tax. It does not include administration fees or adviser commissions.

Source: Chant West media releases over the past 9 years (www.chantwest.com.au), and subsequent information provided by Chant West.

Table 5: Balanced (41-60%) investment performance over 9 financial years

Financial year	1 year to 30 June:	5 years (p.a.) to 30 June:	7 years (p.a.) to 30 June:	10 years (p.a.) to 30 June:
2017/2018	7.0%	7.3%	5.9%	6.6%
2016/2017	8.1%	8.2%	7.3%	4.8%
2015/2016	3.1%	7.1%	7.7%	5.1%
2014/2015	7.8%	8.1%	6.0%	6.0%
2013/2014	9.9%	8.7%	4.4%	6.3%
2012/2013	11.6%	4.9%	4.4%	6.3%
2011/2012	2.8%	1.6%	4.3%	5.5%
2010/2011	8.2%	3.0%	5.4%	4.9%
2009/2010	9.9%	4.0%	5.8%	4.5%

Note: Performance is shown net of investment fees and tax. It does not include administration fees or adviser commissions.

Source: Chant West media releases over the past 9 years (www.chantwest.com.au), and subsequent information provided by Chant West.

Table 6: Conservative (21-40%) investment performance over 9 financial years

Financial year	1 year to 30 June:	5 years (p.a.) to 30 June:	7 years (p.a.) to 30 June:	10 years (p.a.) to 30 June:
2017/2018	5.0%	5.6%	5.3%	6.0%
2016/2017	5.4%	6.3%	6.1%	4.8%
2015/2016	3.6%	5.9%	6.6%	5.1%
2014/2015	6.1%	6.7%	5.5%	5.6%
2013/2014	7.7%	7.3%	4.6%	5.9%
2012/2013	8.7%	4.9%	4.8%	6.1%
2011/2012	4.3%	3.3%	4.9%	5.6%
2010/2011	7.2%	4.2%	5.1%	5.6%
2009/2010	8.7%	4.4%	5.7%	4.8%

Note: Performance is shown net of investment fees and tax. It does not include administration fees or adviser commissions.

Source: Chant West media releases over the past 9 years (www.chantwest.com.au), and subsequent information provided by Chant West.