Industry and retail funds share Top10 podium

A mix of both industry and retail funds led by UniSuper have made it into the Top 10 Performing Growth Funds for calendar 2024, according to year-end analysis by Chant West.

While industry funds dominate the Top 10 ratings over the past 10 years, the latest Chant West analysis appears to point to the competitive changes wrought by factors such as the Your Future, Your Super performance test.

Chant West described the performance of the median growth fund (61 to 80% growth assets) as stellar in circumstances where they returned 11.4%.

“The 11.4% growth fund return comes on the back of the surprisingly strong 2023 return of 9.9% and represents the 12th positive return in the past 13 years. It is also well ahead of the typical long-term return objective of approximately 6% p.a,” the analysis said.

Chant West Senior Investment Research Manager, Mano Mohankumar said international share markets, with a return of 21.2% on a currency hedged basis, led by the tech and financials sectors, were the main driver of the tremendous 2024 result.

“International shares in unhedged terms returned even more, with a staggering 31.2% gain due to the depreciation of the Australian dollar over the year (down from US$0.68 to US$0.62),” he said.

“On average, growth funds have 30% in total invested in international shares and 25% allocated to Australian shares. While not reaching the same heights, Australian shares, with a return of 11.4%, also contributed meaningfully to the strong CY24 result. The other point to note is that all other major asset classes, with the exception of unlisted property, also delivered positive returns for the year.”

“We’re still in the process of collecting final returns for unlisted asset classes such as unlisted property, unlisted infrastructure and private equity. While the loss for unlisted property over FY24 is likely to be around the mid- single digits on average, we estimate that private equity and unlisted infrastructure finished the year with gains in the 7% to 10% range on average”

“Listed real assets were also up, with Australian listed property returning 17.6%, while international listed property and international listed infrastructure yielded gains of 2.8% and 11.9%, respectively. Traditional defensive sectors were also up with cash, Australian bonds and international bonds advancing 4.5%, 2.9% and 2.2%, respectively.”

““With share markets performing so strongly in 2024, particularly international shares, it’s not surprising that the better performing super funds generally had higher allocations to those asset classes. Funds that had lower allocations to unlisted property, cash and bonds would have also benefitted. Having a higher exposure to foreign currency would have also helped.”