POWERED BY MOMENTUM MEDIA
Big super funds don’t always perform best: REI Super
Superannuation fund performance is not reliant on the size on the fund, industry super fund for real estate, REI Super, believes.
Citing rating house, SuperRatings, the fund said smaller funds with total assets under $2 billion performed better than the largest funds over the 10-year period to January 2016.
REI Super chief executive, Mal Smith, said funds with an all-profits-to-members model often came out ahead, because of a high quality investment strategy, which was more important than the size of investment.
However, last month, research house Chant West found industry funds only marginally outperformed retail funds in February, producing returns of -0.4 per cent and -0.5 per cent respectively. It found the outperformance was thanks to higher allocations to unlisted assets.
"Strong long-term performance is the result of an agile and rigorous investment strategy," Smith said.
"And contrary to conventional wisdom, when it comes to superannuation funds, this data confirms that size doesn't always deliver economies of scale. We believe a virtue of our size is that we can be quite active in our asset allocation in volatile markets, and we are not so big that we will move the markets in which we invest.
"The funds that are performing well are in fact the ones with a high quality investment strategy and process."
Recommended for you
In its pre-election policy document, the FSC highlighted 15 priority reforms, with superannuation featuring prominently, urging both major parties to avoid changing super taxes without a comprehensive tax review.
The Grattan Institute has labelled the Australian super system as “too complicated” and has proposed a three-pronged reform strategy to simplify superannuation in retirement.
Super funds delivered a strong 2024 result, with the median growth fund returning 11.4 per cent, driven by strong international sharemarket performance, new data has shown.
Australian Ethical has seen FUM growth of 27 per cent in the financial year to date.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
36.43 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
35.08 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.72 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
29.60 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
27.64 3 y p.a(%)
