Chant West said listed shares and property markets – the main drivers of growth fund performance – had mixed results over the September quarter, which led to the median growth fund posting a 1.7 per cent gain.
“Australian shares fell 0.6 per cent, partly as a consequence of falling commodity prices but also due to international investors seeking to repatriate their money to the ‘safe haven’ of bonds,” a statement from Chant West said.
“International shares advanced 0.9 per cent in unhedged terms, but a much higher 5.7 per cent in unhedged terms due to the sharp depreciation of the Australian dollar,” the statement said.
“Australian listed property had a positive quarter, delivering 1.2 per cent, while international listed property retreated 1.3 per cent."
Chant West director Warren Chant said investors were “reasonably sanguine” about economic prospects at the start of the financial year but now, as “fear and volatility” have set into global markets, investors are nervous.
“In September and October to date, we’ve seen share markets stumble, both in Australia and overseas,” Mr Chant said.
“Shares have the greatest influence on growth fund performance, and as a result we estimate that the median growth fund return for the financial year to mid-October is close to zero,” he said.
“Naturally this is disappointing, but it is far too early to tell whether this is just a pause for breath or a complete change of direction,” Mr Chant said.
