After a stellar 2019 when the median growth fund returned 14.7 per cent, super funds kicked off the new year with an impressive start, returning 1.9 per cent in January, according to research house Chant West.
The momentum has continued into February and Chant West estimates that the median growth fund is up a further 1.5 per cent so far this month.
The surge in super fund performance came on the back of a strong month for Australian shares, local and overseas bonds and the depreciation of the Australian dollar.
In January, Australian shares surged 4.9 per cent while listed property was also up.
Commenting on the investment results, Chant West senior investment research manager, Mano Mohankumar said fears over the coronavirus meant international shares were the only thing holding super funds back from an even stronger performance.
“In January, while the domestic share market was strong, global share markets slowed amid mounting fears over the spread of the coronavirus,” Mr Mohankumar said. “This resulted in a flight to safely, pushing domestic and global bonds up 2.3 per cent and 1.8 per cent, respectively.
“Global investors seem to have regained their confidence in February, with both Australian and global share markets recording gains so far.
“So, the year has started positively despite some lingering uncertainties. The biggest unknown is the potential spread of the coronavirus and what that might mean in economic terms.
“Travel and tourism-related businesses are already feeling the effects, as are others with strong trade links to China such as health food exporters. Investors are now weighing up which other sectors may suffer if the contagion continues.
“Australia is in the forefront here, because not only is China a major export market, it also supplies many parts and finished goods that Australian businesses rely on.”
How has your super fund performed so far this year?
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