GROWTH superannuation funds have posted their worst returns since the GFC, as expectations for the global economy withered and markets fell.
Returns on the funds grew by a 0.5 per cent in the year to June 30, compared with a 9.2 per cent the year before, according to superannuation fund research group Chant West. It was the worst result since 2009, when the financial crisis sent the funds plunging 12.9 per cent.
Chant West defines "growth" funds as those with 61 to 80 per cent of their cash invested in growth assets. They are the default option for most working-aged Australians.
"The 2012 financial year was a tough one for funds to navigate because there were opposing forces at work that shifted market sentiment to and fro and prevented any clear pattern emerging," said director Warren Chant. Even as the global economy clawed its way back from the GFC-induced trough, "negative sentiment associated with the debt crisis in Europe" pushed shares lower. Shares in the benchmark S&P/ASX 200 Index closed the financial year down nearly 11 per cent.
"Taking all that into account, a small positive return is probably not a bad result," said Mr Chant, who noted that the three-year average gain now stood at 7 per cent, well above inflation, which averaged about 2.6 per cent over the same period.
In the year to June, the top-performing growth fund was QSuper Balanced, up 6.4 per cent. The Health Super Medium-Term Growth fund rose 3.3 per cent.