Hostplus tops 12-month and 10-year superannuation returns

Hostplus was one of three funds delivering a positive return for the year, despite sharemarket turmoil. See the list.

Hostplus chief investment officer Sam Sicilia. His fund has posted the best performance in the last 12 months. Picture: Russell Millard

Hostplus would not be the best performing super fund of the past 12 months and 10 years without its well-timed pivots and long view on returns, chief investment officer Sam Sicilia says.

The fund for workers in hospitality, tourism and recreation has topped the SuperRatings chart as the best balanced superannuation provider of the last decade.

The Hostplus balanced option delivered a 1.6 per cent return last year.

SuperRatings data shows three funds managed a positive return to members of their balanced products in that period.

“We did nothing that we haven’t been doing for the better part of 25 years,” said Mr Sicilia. “We believe in the more diversification the better.”

Hostplus was also reaping the benefits of its selldown of its bond holdings in 2015, he added.

“Sure enough, last year the equity market fell and the bond market fell, and anyone using bonds to protect themselves didn’t get protection,” he said.

Qantas Super’s Growth product recorded the second-best performance in the past 12 months, up 0.6 per cent, followed by Christian Super’s MyEthicalSuper, which had a return of 0.5 per cent.

Christian Super was last year the subject of negative findings by the prudential regulator after previously failing performance tests.

The Australian Prudential Regulatory Authority had required it to immediately find a merger partner after failing performance tests.

On Thursday Christian Super moved closer to sealing its merger with Australian Ethical Super, after inking a deed to transfer its members.

Legalsuper’s balanced MySuper product was next in line — its members’ retirement savings declining by 1 per cent.

Treasury will review the superannuation industry’s Your Future, Your Super performance regimen, delaying a planned expansion of the scheme to more products for at least a year.

The federal government said it was responding to concerns from the sector that the laws have the potential to “create perverse or unintended outcomes”.

The country’s largest fund, AustralianSuper, announced its balanced option had delivered a 2.73 per cent negative return for the year.

SuperRatings executive director Kirby Rappell said that while some super funds had been hit with negative returns in 2022, “the benefits of diversification have shone through” for some investment managers.

“When we compare returns for equity, bond and listed property markets to balanced-style portfolios among super funds, these results should be reassuring to members,” he said.

“Superannuation is a long-term investment and patience remains key. For those Australians under 50, the recent market volatility is not expected to have any impact on their retirement.

“This year’s results are just one out of a 30 to 40-year investment for younger Australians.”

The year’s negative returns are only the fifth time in three decades that retirement savings have gone backward.

SuperRatings noted that although many funds closed out the year in the red, there had been some small when median balanced options delivered a 0.9 per cent rally in the first 11 days of July.

The analysts said superannuation should best be seen as a long-term performance test, noting one year returns were “not the full story”.

Hostplus has topped the tables for 10-year returns – 9.7 per cent per annum – followed by AustralianSuper, which posted a 9.3 per cent return.

On average, super funds have returned 7 per cent per annum since compulsory super was established in 1992.

Originally published as Hostplus tops 12-month and 10-year superannuation returns