AUSTRALIA - Superannuation funds plunged an average 5% over January due to market corrections, according to the agency SuperRatings.
Jeff Bresnahan, managing director, SuperRatings, commented: "The way balanced options are constructed means that, on average, members can expect a negative result every six years.
"The double digit results over the last four years have not come without risk and every trustee in the country is aware of the need to ensure these risks do not get out of hand."
Since 2003-04 Australian funds have produced returns in the low to mid teens following small and even negative results at the start of the decade.
Over December 2007, funds saw an average loss of -0.46% but still retained a financial year overall return of 1.7%.
Following the dip in January 2008, the financial year to date total plummeted to a negative -3.33%.
Bresnahan said many scheme members had a habit of focussing on bad news and would see 2007-08 as a disaster already.
He concluded: "The challenge for funds is how they go about communicating this year's returns to members given the abnormally high returns over the past four years."
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