Research firm Chant West has revealed the 10 top performing superannuation funds.
The top performing funds include AustralianSuper, Care Super, Equipsuper, Health Super, Hostplus, NGS Super, QSuper, REST, Sunsuper and Unisuper.
The average return among the 10 top performing funds over the past seven years was 4.3 per cent per annum above inflation.
"That's a very healthy real return," Chant West chief executive Warren Chant said.
All these superannuation funds are not-for-profit funds.
AustralianSuper delivered a 7.3 per cent return over the seven-year period, while Care Super posted a 7.1 per cent return. The third top performing fund, Equipsuper, delivered a 7.0 per cent return over the same period.
"The list shows our high regard for the quality of the investment offerings of industry funds generally," Chant said.
According to Chant, these funds have delivered stellar returns because their strong cash flow, through the compulsory superannuation system, allows them to invest in alternative assets.
Alternative assets include infrastructure and private equity.
"Their strong cash flows allow them to take a long-term view, which typically means they have meaningful investments in unlisted and alternative assets," Chant said.
"This gives them additional sources of return, as well as diversification benefits when combined with traditional shares, property and bonds."
In assessing a fund's investments, Chant West looked at the quality of its investment governance, its in-house investment team and asset consultant, and the structure of its investment portfolios.
The not-for-profit superannuation fund sector also dominated the top 10 personal superannuation funds list.
These funds included AustralianSuper, Care Super, First State Super, Government Employees Superannuation Board, Hostplus, NGS Super, QSuper, REST Super, Sunsuper and UniSuper.
"To be a top 10 rated fund, it must be strong in all of the key areas we assess including organisational strengths, investments, fees, insurance, administration and member services. It's the total package funds offer that results in them scoring highly," Chant said.
