Australian superannuation funds delivered "excellent" returns in FY24 despite continuing high inflation and interest rates worldwide and various geopolitical threats, according to Chant West.
Chant West senior investment research manager Mano Mohankumar said the median Australian growth superannuation fund delivered a median return of 9.1% in FY24.
This was largely driven by strong share market returns both in Australia and overseas. Chant West tallied international share market returns at 21.5% and ASX shares at 11.9% (including dividends) for the year.
A median growth fund is the middle-of-the-road option among superannuation growth strategies. It has a 61% to 80% allocation to growth investment assets like international and ASX shares.
'All growth funds', which allocate 96% to 100% of superannuation monies to growth assets, returned a median 12.7% in FY24.
'High growth funds' with 81% to 95% growth investments delivered 10.8% median returns.
Mohankumar marvels at the recovery that median growth superannuation funds have made since their 3.3% negative return in FY22. Last year, they bounced back with a 9.2% return.
He commented:
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.
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 percent return over the subsequent two years …
Top 10 median growth superannuation funds of FY24
Chant West has published a list of the top 10 median growth superannuation funds for returns in FY24.
All of them delivered returns above the median for their category of superannuation (9.1%).
Note: Their performance is shown net of investment fees and tax but before administration fees.
| Rank | Superannuation fund name | FY24 return |
| 1 | Mine Super Growth | 10.7% |
| 2 | Colonial First State (CFS) FirstChoice Growth | 10.7% |
| 3 | IOOF Balanced Investor Trust | 10.7% |
| 4 | Brighter Super Balanced | 10.6% |
| 5 | Qantas Super Growth | 10.1% |
| 6 | Mercer Growth | 10.1% |
| 7 | Australian Retirement Trust – Super Savings Balanced | 9.9% |
| 8 | MLC MySuper Growth | 9.8% |
| 9 | MLC Balanced | 9.6% |
| 10 | Aware Super Balanced | 9.6% |
What about balanced and conservative superannuation funds?
Chant West reports a median 7.4% return in FY24 for balanced superannuation funds.
These funds have 41% to 60% in growth assets and the rest in defensive assets like cash and bonds.
Conservative funds, which have only a 21% to 40% allocation to growth assets, returned 5.5% in FY24.
Balanced and conservative funds are popular with pre-retirees. Workers often switch to lower-risk strategies in their final years in the workplace to preserve their superannuation savings.
Balanced funds are also typically the default fund assigned to workers who do not nominate a strategy themselves when setting up their superannuation fund.
