Australian superannuation funds delivered "a stellar result" last year as inflation growth moderated and many central banks in Western nations began cutting interest rates.
Newly released data from Chant West shows the median Australian growth superannuation fund delivered a total return (capital growth plus dividends) of 11.4% in 2024.
To clarify, Chant West defines a median growth fund as one with 61% to 80% allocation of superannuation monies to growth investment assets such as international and ASX shares.
The 11.4% return is well above the long-term average target of 6% and higher than the 9.9% return of 2023.
It's also the 12th year of positive returns for Australian super funds out of the past 13 years.
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What drove superannuation funds higher last year?
Chant West senior investment research manager Mano Mohankumar said international share markets were the main driver of growth last year.
Collectively, they returned 21.2% on a currency-hedged basis and a "staggering" 31.2% in unhedged terms, he said.
The disparity is due to the Australian dollar's depreciation over the year.
The currency fell from about 68 US cents to 62 US cents by the end of 2024.
Mohankumar said ASX stocks returned 11.4% and, therefore, "contributed meaningfully" to the outstanding overall results for Australian superannuation funds.
He said superannuation funds with higher allocations to shares did better than conservative funds.
Mohankumar said:
With share markets performing so strongly in 2024, particularly international shares, it's not surprising that the better performing super funds generally had higher allocations to those asset classes.
Funds that had lower allocations to unlisted property, cash and bonds would have also benefitted.
Having a higher exposure to foreign currency would have also helped.
'All growth funds', which allocate 96% to 100% of superannuation monies to growth assets, delivered an outstanding median return of 16.5% in 2024.
'High growth funds' with 81% to 95% growth investments delivered a 13.8% median return.
Balanced superannuation funds, which have 41% to 60% of superannuation monies in growth assets and the rest in defensive assets like cash and bonds, delivered a median 8.7% return in 2024.
Conservative funds, which have a 21% to 40% allocation to growth assets, returned 6.3% in 2024.
Mohankumar said Chant West was still collecting final returns for unlisted asset classes.
He expects a mid-single-digit loss for unlisted property and 7% to 10% gains for private equity and unlisted infrastructure.
He added:
Listed real assets were also up, with Australian listed property returning 17.6%, while international listed property and international listed infrastructure yielded gains of 2.8% and 11.9%, respectively.
Traditional defensive sectors were also up with cash, Australian bonds and international bonds advancing 4.5%, 2.9% and 2.2%, respectively.
Top 10 median growth superannuation funds of 2024
According to Chant West, these are the top 10 performing median growth superannuation funds for 2024.
Remember, Chant West defines a median growth fund as one with a 61% to 80% allocation to shares.
| Rank | Superannuation fund name | 2024 return |
| 1 | UniSuper Growth | 14.7% |
| 2 | Colonial First State (CFS) FirstChoice Growth | 13.6% |
| 3 | Mine Super Growth | 13.4% |
| 4 | Vanguard Super SaveSmart Growth | 12.9% |
| 5 | smartMonday Balanced Growth | 12.8% |
| 6 | Mercer Growth | 12.7% |
| 7 | legalsuper MySuper Balanced | 12.4% |
| 8 | Aware Super Balanced | 12.4% |
| 9 | AMP Future Directions Balanced | 12.2% |
| 10 | Brighter Super Balanced | 12.1% |
