Which two super funds saw positive returns in 2022?

Super endured a tough year in 2022, with just two funds managing to return a profit.

Given soaring inflation and rising interest rates, funds could be forgiven for not returning a profit.

And so it was, with analysis from SuperRatings revealing the median balanced fund had a return of negative 4.8 per cent in 2022 – compared to an average return of 13.4 per cent at the end of 2021.

This was only the fourth time in 22 years that average returns were negative, and SuperRatings says this was driven mostly by declines in property and international shares.

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But it also said two funds had bucked the trend. The overall best-performing fund for 2022 was Perpetual’s Balanced Growth fund, which posted a 1.7 per cent return. In second place was First Super’s Balanced option, which saw a return of 0.1 per cent.

The wafer thin profits demonstrate just how tough the climate was for super. To ram the point home, the third best performing fund was CareSuper’s Balanced option, which had a return of – 2 per cent. The next best balanced options were: Brighter Super (-2.2 per cent), Qantas Super Gateway (-2.2 per cent) and Hostplus (-2.5 per cent), Australian Retirement Trust  Super Savings (-2.6 per cent), Mercer Super Trust Mercer Select (-3.4 per cent), Plum Pre-mixed Moderate (-3.4 per cent) and ESS Super Basic Growth (-3.6 per cent).

“Funds have faced a tough calendar year, though performance has improved over the last couple of months,” says Kirby Rappell, executive director of SuperRatings.

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While super funds are down in the short term, Mr Rappell cautioned Australians not to look to closely at short-term results, as super is a long-term investment.

When looking at super performance over a 10-year period, the results are much better. Over that time, Hostplus’s Balanced option delivered a 9.1 per cent return per annum, while AustralianSuper’s Balanced option returned 8.8 per cent.

The top 10 best-performing funds over the past decade are all still returning an average of more than 8 per cent per annum.

“While members may be disappointed with this year’s performance, if we look at the long term, funds continue to perform well against objectives,” Mr Rappell says.

Read: Australian super funds dominate global pensions report

“With more uncertainty ahead, it remains important to set your strategy and try to ignore the current market.”

Senior investment research manager at analytics firm Chant West, Mano Mohankumar, said the 2022 calendar year had been “highly unusual”, with all traditional listed asset sectors (except cash) closing the year in the red.

“What made the year even more challenging was that bonds didn’t play their usual cushioning role,” he said.

“It’s highly unusual for both shares and bonds to fall over a full year but that’s what happened in 2022.”

How did your fund perform last year? How is it performing over a 10-year period? Share your observations in the comments section below.

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