Which industry super fund do I think is the best overall? (Inc. 2022 super returns)
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Investopoly
Which industry super fund do I think is the best overall? (Inc. 2022 super returns)
Aug 03, 2022 Episode 219
Stuart Wemyss

 Superannuation returns for the 2021/22 financial year were mostly negative. However, we shouldn’t forget that the previous 18-month period (i.e., mid-2020 to the end of calendar year 2021) was stellar, so we must keep a longer-term perspective. 

And the winner is… 

The table below sets out investment returns for the largest 8 industry funds based on a Balanced investment option (data provided by research house, Lonsec). The table is sorted by 1-year returns, highest to lowest for the financial year ended June 2022. Hostplus achieved the highest return – more about this below. 

 TABLE

I have selected the relevant pre-mixed investment options that have between 60% and 76% of assets invested in growth assets e.g., shares. This is defined as a Balanced asset allocation. You will note however that some super funds don’t use the Balanced description – some call the option Growth or Core and so on. This highlights that it is important to not rely solely on an investment option’s name. Instead, it is important to examine the actual asset allocation of the option you are considering. 

Click here to view a similar comparison for a Growth investment option. 

Beware of unlisted assets valuations (or lack thereof) 

One of the concerns I have with some of these industry super funds is their lack of transparency, particularly with unlisted investments, as I discussed here last year. Transparency invites more accountability, which is a positive attribute, especially when investing is concerned. That is why I’m so attracted to rules-based and evidence-based investment methodologies – they are completely transparent. 

Transparency allows stakeholders to make better assessments as to an investment portfolios inherent risks and therefore likely future returns. Transparency reduces risk too because there’s nowhere to hide fees, risk or underperformance. 

I read with great interest this article in the AFR on 20 July 2022. The article suggested that two super funds held an interest in Australia

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