Super funds rating service Chant West has delivered good news about the current state of Australia’s superannuation industry. Median growth funds (those with between 61 and 80 per cent growth assets) have grown by double-digit figures for the second year in a row.

The average all-industry returns for the 2013/14 financial year came in at a very healthy 12.8 per cent. Statewide Super, Telstra Super and Vic Super lead the charge of growth funds with returns between 14.9 and 15.8 per cent.

Returns for the past five years have been: 2009/10 – 10.4%, 2010/11 – 9.2%, 2011/12 – 0.5%, 2012/13 – 15.6%, 2013/14 – 12.8%.

Mano Mahankumar of Chant West. Photo:

Mano Mahankumar of Chant West. Photo:

While industry experts are understandably chuffed with the returns, they are cautious about projecting its continuance. “The typical strategy objective for a growth fund,” says Chant West research manager Mano Mohankumar, “is to exceed inflation by about 3 to 4 per cent so that translates to a return of between 6 and 7 per cent per annum.

“What we’ve seen in the last couple of years is exceptional.”

It seems at odds with the current malaise of world finance that superannuation returns should produce five straight years of positive figures. Mr Mohankumar believes fund yield stemmed from the strong performances of shares, both domestic and international.

“International shares delivered over 20 per cent for the year while Australian shares returned about 17 per cent,” he said.

Rival ratings firm SuperRatings investigated the same median balance fund assets and put the figure at 12.7 per cent for the 2013/14 year. Almost exactly the same as the figure arrived at by Chant West.

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