Today's Age includes a list of the top performing diversified super funds over the year to 1 March 2007. The winner is (amazingly) the NSW Bookmakers Accumulation Fund (can't say I have been watching this one closely lately) at 19.9%. There's a few near it, five at the 14% to 15% mark and it drops away sharply after that.
The Australian share market rose 22% in the same period.
So our "standing instructions" to use a self managed super fund and invest in the Vanguard Australia Shares Index fund means our clients beat them all.
And they did it without commissions, without middle men, without hours of time and with minimal risk.
There is a huge body of research and learning supporting this apparently simple advice and recommendation. In the long run, on average, index funds will outperform most active investors (but not all). And the high level of franking credits in the VGASIF lifts the after tax performance by an extra two per cent (or so) making it even better again.
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