Super funds deliver small gains in August despite market turbulence

The median balanced option returned 0.4 per cent to members over August, staging a rebound from market turbulence that saw the option dip 1.7 per cent over the first two weeks of the month.

Meanwhile, the median growth option grew by an estimated 0.3 per cent over the month while the median capital stable option, buffered by a lower exposure to shares, rose an estimated 0.5 per cent.

Pension returns also followed a similar pattern, with the median balanced pension option increasing by 0.4 per cent.

The median capital stable pension option and the median growth pension option grew 0.6 per cent and 0.3 per cent respectively over the same period.

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Kirby Rappell, executive director at Super Ratings, observed the first two months of the new financial year were marked by the return of greater volatility.

“Share markets have had a strong impact on fund returns. However, the need to focus on long term outcomes rather than getting caught up in daily movements is as important as ever,” he said.

The new financial year began with strong returns, continuing the momentum built up at the end of 2023-24, Rappell noted, although a major market sell-off at the start of August had largely “given back” these results.

Still, the executive reiterated the long-term horizon of super returns, encouraging members “to focus on blocking out short term noise in favour of longer term outcomes”.

He also noted that, as super balances are expected to rise and fall, members’ risk appetite and age should be considered in determining if they should take any action around their investment choice.

“For anyone concerned about their super balance and how it will perform most funds have a range of education and tools available on their websites. Some funds will also provide members access to financial advice, however it's important to check if there is any cost associated with using advice services,” Rappell said.

Importantly, superannuation remains a long-term investment and funds have consistently delivered good long-term outcomes, he said.

“However, for those worried about how their super is doing in these conditions there are a lot of resources available to support members in making the choice most suitable for their situation.”