Understanding historical returns by asset class helps you interpret how your super fund’s asset allocation translates into performance. Here’s what the major asset classes available in Australian superannuation have historically returned.
Why Asset Class Returns Matter for Super
Your super fund’s investment option is essentially a mix of asset classes. A “balanced” option might be 45% Australian shares, 25% international shares, 10% property, 10% infrastructure, and 10% fixed income. The return of that option over time reflects the weighted average of each component’s performance.
Knowing the historical range of returns by asset class helps you:
- Understand the risk-return tradeoffs in your option
- Set realistic expectations for long-run super growth
- Compare your fund’s return against what that asset mix would theoretically have delivered
Historical Returns by Asset Class
Note: Past performance is not a reliable indicator of future returns. Figures are approximate long-run averages based on published Australian market data. Actual super fund returns will vary based on specific implementation, timing, and costs.
| Asset class | Approximate long-run annual return (est.) | Volatility (approx.) |
|---|---|---|
| Australian shares (ASX 200) | 8–10% | High |
| International shares (unhedged) | 9–12% | High |
| Listed property (A-REITs) | 8–10% | High |
| Unlisted property (direct) | 7–9% | Low to medium |
| Infrastructure (unlisted) | 8–11% | Low |
| Global fixed income (hedged) | 3–5% | Low |
| Australian bonds | 4–6% | Low |
| Cash (90-day T-bill rate) | 2–4% | Very low |
Australian Shares
The ASX 200 has historically delivered approximately 8–10% per year including dividends and franking credits over rolling 20-year periods. This includes the GFC (2008–09), COVID-19 crash (2020), and multiple other corrections.
Annual variation is significant — calendar year returns have ranged from approximately -40% (2008) to +35% (2021). Super funds that hold Australian shares directly smooth some of this through regular contributions and diversification within the sector.
International Shares
International shares (primarily US and global developed market shares) have returned approximately 9–12% per year over long periods. Unhedged exposure includes currency effects — the AUD/USD exchange rate adds another layer of volatility.
Since the GFC, international shares (particularly US tech-heavy indices) have outperformed Australian shares significantly. Whether this continues is uncertain.
Infrastructure and Unlisted Property
Large industry funds (AustralianSuper, IFM Investors, Australian Retirement Trust) hold significant allocations to unlisted infrastructure — toll roads, airports, utilities — and unlisted property. These assets have historically returned approximately 8–11% with much lower reported volatility than listed shares.
This is a key structural advantage of large industry funds. Retail investors and smaller funds have limited access to comparable unlisted infrastructure at equivalent cost.
Fixed Income (Bonds)
Bonds have historically provided 3–6% per year, acting as a buffer against sharemarket volatility. However, the 2021–2023 interest rate rise cycle produced sharply negative bond returns — a reminder that bonds are not without risk, particularly in rising rate environments.
In a super portfolio, the role of fixed income is typically to reduce overall volatility, not to generate high returns.
Cash
Cash (90-day T-bills, bank accounts) has historically returned 2–4% — below inflation in many periods, meaning negative real (after-inflation) returns. Cash in super is appropriate for very short time horizons (e.g., near-term drawdown planning) but is not suitable for the accumulation phase.
Frequently Asked Questions
Does my super fund publish returns by asset class? Many funds publish returns for individual investment options (Australian shares, international shares, etc.) in their annual report or on their website. These are useful benchmarks.
What does an unlisted infrastructure allocation mean for my super? Unlisted infrastructure provides smoother, more stable reported returns than listed assets because the assets are valued periodically (not daily) by independent valuers. Returns are comparable to listed infrastructure over the long run but with lower reported short-term volatility.
Is a 100% Australian shares option a good idea? An Australian shares option concentrates all super in a single asset class and a single country’s market. The ASX is also heavily weighted toward financials and resources. Most financial planners suggest diversification — through a balanced, growth, or diversified fund — reduces concentration risk.
For more: What Is a Good Super Return?, Growth Fund vs Balanced Fund, How to Choose a Super Fund. For advice on asset allocation, speak with a licensed financial adviser via MoneySmart.