An analysis of the performance of the superannuation sector for the 2015 calendar year by SuperRatings found the median balanced option returned 5.6 per cent.
While this sits well below the 6.3 per cent and 8.1 per cent returns seen in 2013 and 2014, it is a solid result given volatile market conditions, SuperRatings said.
“Subdued levels of growth across most major economies and volatile investment markets have made 2015 a challenging year for super funds, with returns across the main growth asset classes sitting well below what we have experienced in previous years,” SuperRatings founder Jeff Bresnahan said.
“Despite tough market conditions, diversification and a falling Australian Dollar have helped superannuation funds cushion the bumpy ride for members and produce a fourth consecutive positive calendar year return.”
Meanwhile, a number of the best-performing funds saw solid results in 2015, including MTAA Super, which took out the top spot with 9.5 per cent return for its members. BUSSQ, the second best placed fund, returned 8.6 per cent for the 12 months.
“The top 10 funds comprised a range of large, medium and small funds, proving that size does not necessarily lead to better investment outcomes,” SuperRatings said.
Returns over the longer term remain solid, the analysis said, with median balanced options' return over the five to seven years to 31 December 2015 sitting at 7.9 per cent per annum and 8.3 per annum, respectively.
This is well above most funds’ long-term return targets of inflation plus 3.5 per annum, SuperRatings said.
As for January so far, Australian markets have experienced sharp falls after turmoil in Chinese markets, with the ASX 200 Index down 7.4 per cent. SuperRatings estimates the median balanced option has fallen by 3.8 per cent during the month of January to date.
“While balanced options have experienced reasonable losses in January, which have wiped out most of the 2015 calendar year return, these declines remain well below those experienced across share markets, once again highlighting the benefits of diversification across asset classes within Balanced Options,” Mr Bresnahan said.
“In spite of short-term losses across many asset classes, super fund members are encouraged to take a long-term view of their superannuation investments."
