ESSSuper, Vision Super, and Brighter Super are 2023’s top balanced funds, sustainable investments also excelled

Workers in the six top-performing balanced funds scored double-digit returns in the 2023 financial year. Find out which super funds excelled.

Workers in the six best performing balanced super funds achieved double-digit returns this financial year, according to research house Super Ratings, with ESSSuper, Vision Super and Brighter Super leading the way in the top three spots.

Investments with a sustainable focus were also at the top, led by Raiz Super’s ESG portfolio that achieved 13.3 per cent for the year, with the other top five sustainable balanced options mostly beating the balanced options.

The preliminary (about one third of funds are yet to report results) median return for balanced portfolios – those with between 60 and 76 per cent of their portfolio invested in growth assets – is 9 per cent.

The annual result for 2023 is a big turnaround that more than offsets last year’s 3.4 per cent loss.

With tech shares driving global stocks close to 20 per cent higher for the year to June, balanced funds with the highest allocation to shares performed the best. Conversely, those that had more investments in unlisted property and alternative assets, whose valuations have been hit by higher interest rates, had more subdued outcomes.

Top 10 Balanced Options over 12 months. Returns are after investment fees and taxes. Source: SuperRatings

ESSSuper, the dedicated super fund for emergency services and Victorian government employees, was the top performing balanced fund, returning 13.3 per cent for the year to June.

“Performance over the last 12 months has been a welcome result for our members and follows a multi-year program of reorienting the portfolio towards areas of competitive advantage,” said ESSSuper’s group executive of investments, Daniel Selioutine.

“Our shorter term performance is explained by our positioning in equities and bonds, however our dedicated investment team remains firmly focused on delivering longer-term investment outcomes to members.”

Rounding up the top three was Vision Super’s balanced growth option with 11 per cent and Brighter Super’s balanced option with returns of 10.6 per cent.

Mark Rider, chief investment officer at member-owned Brighter said the fund’s underweight position in private equity had further helped its performance. 

“There has been a consistency across the performance of the fund,’’ Mr Rider said. “In addition to having the right bias in the portfolio towards listed equities and away from private equity, having solid performance across all asset classes, relative to the appropriate benchmark, supported performance versus our peers.”

Workers in the six top-performing balanced funds achieved double-digit returns this year.

Out of the big funds, UniSuper’s accumulation balanced option was top of the list with 10.3 per cent return for the year, followed by Australian Retirement Trust’s super savings balanced option’s 10 per cent return, and Aware Super’s future saver balanced achieving 9.7 per cent.

Equip’s MyFuture balance growth option also delivered double-digit return of 10.1 per cent for the year.

Over the longer term, Hostplus, AustralianSuper and Australian Retirement Trust super balanced options had the top three spots with annual returns over the past 10 years of 8.9 per cent, 8.6 per cent and 8.4 per cent, respectively.

“While short term trends may be topical, longer term trends are our primary focus as we want to see which funds have performed well over the long term and their alignment with their member’s outcomes,” said SuperRatings executive director Kirby Rappell.

Sustainable balanced options from Super SA, UniSuper, Aware Super and Future Super rounded up the top five for the sector. The returns ranged from 12.1 per cent for Super SA’s socially responsible option, 11 per cent for UniSuper’s sustainable balanced option, 10.9 per cent at Aware Super’s balanced socially conscious option, and 10.5 per cent from Future Super’s balanced index.

IOOF’s multiseries 70 option topped the retail funds rankings with its 9.8 per cent return for the year, followed by Mercer select growth’s 9.6 per cent and Australian Ethical’s 9.3 per cent return.

Originally published as ESSSuper, Vision Super, and Brighter Super are 2023’s top balanced funds, sustainable investments also excelled