‘Flying start’: Super funds cash in on soaring ASX

Aussies are tipped to be a little richer at the end January, as superannuation funds have a ‘flying start’ to 2025.

Workers are tipped to be up as much as 2.2 per cent thanks to strong share market gains. Picture: NewsWire / John Appleyard.

Australian superannuation funds have backed up a “tremendous” result in 2024 in the first month of 2025, thanks to strong gains in the share market.

Stats released by Chant West show the median growth fund (61 to 80 per cent in growth assets) is up 2.2 per cent in January, overcoming share market jitters at the end of the month.

Chant West senior investment research manager Mano Mohankumar said January returns were driven by strong growth in both the local and international market, with European stocks outperforming during the first month of the year.

Workers are tipped to be up as much as 2.2 per cent thanks to strong share market gains. Picture: NewsWire / John Appleyard.

“Donald Trump officially took over as President for his second stint in mid-January and sentiment in the US continued to be buoyed by his ‘America First’ policy agenda, “ he said.

“However, his tariff threats shook markets at the end of the month.”

“In late January, we also saw the US tech sector take a hit on the back of claims that Chinese start-up, DeepSeek, had trained its generative AI capability to produce results comparable to the market leaders at a fraction of the cost.”

With share markets performing so strongly over the month, higher risk options fared better, as bond markets were relatively flat over the first month.

The strong start to 2025 comes off the back of market beating results in 2024, with the median balanced option returning 11.1 per cent for the calendar year.

Aussies are being urged to think of their superannuation as long term product. Picture: NewsWire / John Appleyard

Those invested in high growth, which would have 96-100 per cent in equities would be up 3.1 per cent over the month.

While the last 13-months have been good for members, Mr Mohankumar said it is important Aussies look at their superannuation as a long-term asset.

“Since the introduction of compulsory super in July 1992, the median growth fund has returned 8 per cent a year while the annual CPI increased by 2.6 per cent, giving a real return of 5.4 per cent . – well above the typical 3.5 per cent target.

“Even looking at the past 20 years, which includes three major share market downturns – the GFC in 2007-2009, COVID-19 in 2020, and the high inflation and rising interest rates in 2022 – super funds have returned 7.2 per cent a year, which is still comfortably ahead of the typical objective.”

Originally published as ‘Flying start’: Super funds cash in on soaring ASX