What were the best-performing growth funds of FY23–24?

Mine Super, Colonial First State, and Insignia share the title of best-performing growth fund in the financial year 2024, according to Chant West.

Mine Super Growth, CFS FirstChoice Growth, and IOOF Balanced Investor Trust each delivered 10.7 per cent, followed by Brighter Super Balanced at 10.6 per cent.

Qantas Super Growth and Mercer Growth were next on the ladder having both delivered 10.1 per cent. 

Australian Retirement Trust led the pack in terms of the mega funds, with its Super Savings Balanced option returning 9.9 per cent over the year.

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Among the top 10 performing funds were also MLC MySuper Growth (9.8 per cent), MLC Balanced (9.6 per cent), and Aware Super Balanced (9.6 per cent).

The median return among growth funds, those holding 61–80 per cent in growth assets, was 9.1 per cent over the year.

Chant West senior investment research manager Mano Mohankumar said strong sharemarkets were the main driver of the better-than expected FY24 result, surging 21.5 per cent over the year, led by the strong performance of the tech sector.

“While not reaching the same heights”, Australian shares also saw a healthy return of 11.9 per cent, he said.

“With share markets performing so strongly in FY24, especially international shares, it’s not surprising that the better performing super funds generally had higher allocations to those asset classes,” Mohankumar said.

“In fact, all major asset classes were in positive territory over the year with the exception of unlisted property, which was hurt mainly by downward revaluations in the office sector.”

The research house estimates unlisted infrastructure and private equity finished the year with gains in the 5–7 per cent range.

Meanwhile, Australian listed property returned an impressive 23.8 per cent, while international listed property and international listed infrastructure yielded gains of 4.6 per cent and 2.6 per cent, respectively.

“Traditional defensive sectors were also up,” Mohankumar said, with cash returning 4.4 per cent.

In terms of fixed income, Australian bonds advanced 3.7 per cent and international bonds were a bit more modest at 2.7 per cent.

The loss for unlisted property over FY24, meanwhile, is likely to be in the high single digits on average, he said.

Overall, the FY24 result represents the 13th positive super return in the last 15 years and is “well ahead” of the typical long-term return objective of approximately 6 per cent per annum.

“The return experience over the past two years in the face of much uncertainty is another reminder of the importance of remaining patient and maintaining a long-term focus,” Mohankumar said.

“If you think back two years ago, FY23 kicked off amid surging inflation and uncertainty around when interest rate hikes might come to an end. At that time, I don’t think anyone could have forecast a 19 per cent return over the subsequent two years and the small FY22 loss of 3.3 per cent now seems like a distant memory.”