Top 10 Performing Superannuation Growth Funds of 2021

Ranking Coins

January and July each year, media outlets publish the results of the Top 10 Superannuation Funds over the past 12 months. This year, I noticed the Chant West survey of the Top 10 Industry or Retail Growth Funds for 2021 (see chart below).

A few things stood out in this report. The first stand out for me is the difference in returns between the top performer and the 10th best performing super fund of 4.3%. This is a large variance so how can this be explained? This is largely to do with the underlying asset allocation. These comparisons rarely compare apples with apples, in other words, compare super funds with similar asset allocations to each other. This is complicated further given there is such a difference in the fund’s descriptions of the investment options Balanced, Growth or Moderate.

The only way to really compare these funds is to dig deeper to compare the underlying risk of each fund to their annual returns and that is not easy to do for members firstly because this information is not disclosed and secondly because the risk profile is subject to change due to a tactical asset allocation which changes based on the fund manager’s view of the world. I believe the measure of risk should be added to these comparisons in order for members to have the full picture, after all, risk and return have such a strong correlation that one without the other is bound to provide an incomplete picture for any decision making.

Chant West Top 10 Performing Super Funds

Following the release of this survey, I was asked how does Alman Partners’ Growth Portfolio (with an 85% allocation to growth asset classes & 15% to defensive assets) stack up?

AP 85/15 Performance

1. Performance is net of investment management fees and before administration fees. 

It’s so important to understand where returns come from and not make investment decisions based on the name of the investment option.

Stephen Lowry (CFP® Professional, DFP, AIF®) is a representative of Alman Partners Pty Ltd, Australian Financial Services Licence No: 222107. 

Performance data shown represents past performance or simulated performance. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. 

Note: This material is provided for information only. No account has been taken of the objectives, financial situation or needs of any particular person or entity. Accordingly, to the extent that this material may constitute general financial product advice, investors should, before acting on the advice, consider the appropriateness of the advice, having regard to the investor’s objectives, financial situation and needs. This is not an offer or recommendation to buy or sell securities or other financial products, nor a solicitation for deposits or other business, whether directly or indirectly. 

 

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