fatvegan

I've been wondering about managed super funds, because common sense and anecdotal evidence suggests that managed funds with high fees (like most super funds) are a waste of money. I found a good, short paper and it finds that this is pretty much the case. Out of 33 managed funds it reviewed only 3 made a better than normal return after management fees were subtracted. On the bright side, only 2 funds lost money. The rest basically did nothing. So managed funds aren't really worse than indexed funds, based on that evidence, but I don't why you'd bother. You're more exposed to market drops, because I'll bet they don't drop their fees as fast as the market drops when it does. So if the market does nothing for a year, with a managed fund you might still pay 3% but with an indexed fund you'll get to keep all your money.

I was going to go with Perpetual, because they have impressive returns on the surface, and are probably one of "the three". But you pay about 2.5% points more for about 5% higher return than Hesta. When those returns compress, which I expect they will, I reckon that advantage will go away.

I'm putting 2/3 of my super into shares, which I feel a bit uncomfortable about. Shares seem to be inflated to me. Although I like this graph of price/earnings over the past few years. Inflation of share prices is tricky to measure I suspect, although I suppose profits are like "real output". I should try and understand all that stuff some day.