NEWS - Financial Services
Super funds post negative return in Oct
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By a staff reporter
Australian super funds posted their first negative return in eight months in October, on the back of declining local and international sharemarkets and a strong Australian dollar, according to data from SuperRatings.
Super funds posted a median loss of 1.05 per cent for the month.
SuperRatings said whether the news was a sign that worse is to come, or just a hiccup in the overall recovery, was open to debate.
"The short term recovery by our super funds has been nothing short of amazing, fuelled obviously by listed markets which in turn have been ably assisted by a multi-billion dollar injection into the Australian share market over the six months to the end of September by our major super funds," SuperRatings said.
"... No matter which way one looks at the performance numbers, the key driver for super fund returns over the past eight months has been Australian shares."
SuperRatings said the stronger local currency had diluted international markets.
"Whilst international shares have also performed well, the strengthening of the Australian dollar has significantly diluted these markets. For some funds their hedging strategy has been crucial," SuperRatings said.
For the three months to October 31, super funds posted a rise of 4.62 per cent, while an increase of 5.85 per cent was recorded over the past 12 months.