I have my super in pension phase with about half of the funds in an SMSF and half in an industry fund. The objective of this diversification. I have investments in a range of funds and companies, some generating income, some growth, some defensive. In a recent seminar, a speaker mentioned that if one cannot get better returns than from an index based fund or a well performing industry super fund one may well stop picking funds and stocks, leave investing to others and spend more time on the beach.
So I went back to my spreadsheets to 2015. So how to calculate this? At the end of every month, I determine the % return over the same month of the previous year. I these add all these up and divide by the number of months. The answer 5.3%. My initial reaction was, I might as well sell up and put it all into indexed or the industry fund. But then I remembered the 4% pa compulsory withdrawal. If I add this to the $5.3%, 9.3% looks a bit better.
I tried a different way. I took the total value of my super in Jan 2022, and the value in Jan 2015, worked out the % return and divided by 7 to get the av return by year. The answer 4.9%.
Is this a reasonable analysis? My conclusion is to stick with my model.
Cheers
Stephen
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