Three months of negative super returns

Superannuation fund returns have been in negative territory for three consecutive months, according to specialist research and ratings house, SuperRatings.

According to the ratings house, October will be the third consecutive month of negative returns with the median balanced option expected to be minus 1.6%, while the median growth option is expected to post negative 1.9%

Commenting on the three months of negative returns, SuperRatings executive director, Kirby Rappell said the company had observed continued uncertainty around global markets and inflation which had weighed on returns from shares.

“While data suggests a inflation is moderating, it remains persistently above target and we saw the Reserve Bank (RBA) provide a Melbourne Cup rate rise accordingly,” he said.

“Along with the US Federal Reserve leaving open the possibility of further rate rises to quell their own inflation, the share market rally we have witnessed in November so far may be not be sustainable.”

However, Rappell suggested that, despite the uncertain environment of the past quarter, returns remain positive over one through to 20 years.

“Superfunds continue to display strong capabilities in navigating uncertain market environments and members have been experiencing increased levels of ups and downs for some time now” he said.

“Our message to members remains one of focusing on the long term and sticking with their long-term investment strategy. The ups and downs are likely to continue, and members who are thinking about changing their strategy are encouraged to contact their fund, or speak with a trusted adviser, before making any changes.”