Super funds suffer three consecutive negative return quarters

Mike Taylor

Managing Editor/Publisher, Financial Newswire

22 November 2022

The degree to which investment markets have hit superannuation fund returns has been revealed by the latest quarterly superannuation data from the Australian Prudential Regulation Authority revealing three consecutive negative rate of return quarters.

The data, released today, reveals the rate of return for superannuation funds for the year to September was down 6.4% – “a significant decrease compared to the annual rate of return for September 2021 of 16.9%,” the APRA analysis said.

It noted that this was the third consecutive quarter of negative quarterly rate of return as investment markets had suffered losses predominantly due to a tightening of monetary policy by many central banks, the war in Ukraine and pressure from disrupted supply chains.

The APRA analysis said the average five-year annualised rate of return was 4.8%, down from 7.8% in September 2021.

“Over the September 2022 quarter, total assets for entities with more than six members decreased by 0.3% (or $6.4 billion) to $2.4 trillion. With over $2.1 trillion in investments, 52.4% were investments in equities (21.7% in Australian listed equities; 25.4% in international listed equities; and 5.3% in unlisted equities).

It said fixed income and cash investments accounted for 29.1% of total investments (19.0% in fixed income and 10.1%  in cash). Property and infrastructure accounted for 16.1% of total investments whilst other assets, including hedge funds and commodities, accounted for 2.3%.