Growth funds to end FY19 with returns well ahead of inflation

27 June 2019
| By Hannah |
image
image
expand image

With just two business days left in FY19, superannuation funds are poised to see a positive return of 7.1 per cent for the financial year, outstripping the current rate of inflation by more than 5.5 per cent.

The prediction by Chant West was based on median growth options, in which the majority of Australian workers were invested, that put super fund returns well above the typical long-term objective to beat inflation by 3.5 per cent.

While this figure was below the average returns members may have gotten used to over the last decade, which were close to nine per cent, Chant West senior investment manager, Mano Mohankumar, reminded consumers that such growth wasn’t sustainable as it represented the market’s recovery from the Global Financial Crisis rather than more regular conditions.

Indeed, the research house also warned that many sectors looked to be fully valued or close to it, so investors should expect some challenging times ahead. Further, while the second half of FY19 saw surging share markets off the back of a poor six months to December, during which growth funds lost 2.4 per cent, Mohankumar cautioned members “not to get carried away” as the global economic backdrop still faced uncertainties.

The table below showed Chant West’s estimated diversified fund performance for FY19.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

1 year 1 month ago
Kevin Gorman

Super director remuneration ...

1 year 1 month ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

1 year 1 month ago

While the controversial measures have received little support in the Senate, the think tank has said Division 296 would “make the nation’s super system fairer”....

14 hours ago

In its pre-election policy document, the FSC highlighted 15 priority reforms, with superannuation featuring prominently, urging both major parties to avoid changing super...

14 hours ago

With the merger between Mine Super and TWUSuper in its late stages, the head of the soon-to-be combined fund is the latest to join ASFA’s board. ...

15 hours ago

TOP PERFORMING FUNDS