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   Jul 05

Super funds end financial year with strong returns

The past six financial years have produced positive returns for super funds.Despite big falls on sharemarkets in the days prior to June 30 because of the Greek debt crisis, super funds have finished the financial year with strong returns.
Nanjing Night Net

Researcher SuperRatings’ estimates the typical balanced investment option, where most people have their super, produced a return of 9 per cent for the past financial year.

Sharemarket performances are crucial to the returns of balanced investment options as they typically have about half of their money invested in shares.

The past six financial years have produced positive returns.

Adam Gee, the chief executive of researcher SuperRatings, said the past 10 financial years, which includes the period of the global financial crisis, has produced an average annual return of 6 per cent.

That is about 3 percentage points above inflation.

Depending on the outcome of the referendum in Greece on Sunday the volatility on sharemarkets could continue.

A “yes” vote at the referendum to accept the creditors’ conditions for continuing the bailout would make it less likely Greece exits the euro.

And sharemarkets would be expected to receive a bounce.

The Greek government is campaigning for a “no” vote which, if successful, makes a Greek exit from the euro more likely. Polling shows a “yes” vote is more likely.

Mr Gee said some fund members are too quick to doubt their super fund when there is a sudden dip in markets. “However, as we know, superannuation is a long-term strategy and short-term impacts are usually overcome over time.”

This story Administrator ready to work first appeared on Nanjing Night Net.

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