Equities drag on August super returns

Steering clear of equities gave superannuation funds a minor advantage in August, according to the latest analysis from specialist research house, SuperRatings.

The SuperRatings analysis showed that while the median growth option fell by an estimated 0.3%, a lower exposure to shares resulted in the median capital stable option delivering a small positive result with an increase of 0.1%.

It said the median balanced option delivered a 0.1% fall.

The SuperRatings analysis said that the trajectory for inflation remained a key driver for markets with uncertainty around central bank’s rates pathway remaining front of mind with both Australian and global equities reporting small declines over August.

Commenting on the outcome, SuperRatings executive director, Kirby Rappell said market uncertainty persisted and it was likely that monthly returns would continue to bounce around.

“However, over the long term, we know funds have a strong record of performing above objectives,” he said. “The key message for most members is ensuring their settings are right for the long term in order to provide dignity in retirement.”

Rappell said that while super fund returns in August had been subdued, stronger returns experienced in July meant performance remained positive overall for the new financial year.