SMSF research shows self-managed funds outperformed APRA funds over 5-year period

Since 2021, The University of Adelaide’s International Centre for Financial Services (ICFS) for the SMSF Association, has conducted a large-scale, long term research project. The research examines the financial performance of self-managed superannuation funds (SMSFs) over five years comparing the performance of Australian Prudential Regulation Authority (APRA)-regulated super funds. 

Based on data from over 421,000 SMSFs, the study revealed SMSFs consistently outperformed APRA-regulated super funds over a five-year period.

 

Five-Year Annualised Rates of Return (Geometric Mean)

Financial Year Ending	SMSF Annualised ROR	APRA Fund Annualised ROR	SMSF Outperformance
2021	8.3%	8.0%	+0.3%
2022	6.5%	5.2%	+1.3%
2023	6.5%	5.3%	+1.2%

 

Key insights

• SMSFs outperformed APRA funds in all three five-year periods analysed, with a performance edge ranging from 0.3% to 1.3%.
• The largest outperformance occurred in the five years ending 2022, where SMSFs achieved a 1.3% higher return than APRA funds.
• The consistent long-term outperformance of SMSFs suggests that, despite short-term underperformance in some years (like 2022–23), SMSFs tend to deliver superior returns over extended periods.

This performance advantage may be linked to greater investment control, the ability to tailor asset allocations, and the benefits of obtaining professional financial advice.

 

Advised SMSFs outperformed non-advised SMSFs

In addition to comparing the returns between APRA funds and SMSFs, research was also undertaken to compare the returns of SMSFs of funds receiving ongoing financial advice to those that didn’t.

The overall impact of financial advice shows a positive long-term performance on SMSF returns when compared to non-advised funds. Advised SMSFs had a higher median return of 7.6% when compared to non-advised funds, sitting at 6.4%.

The research also showed that advised funds were less likely to be in the lowest-performing quartile, suggesting that professional advice helps trustees avoid poor investment decisions. This underscores the importance of professional financial advice in optimising SMSF investment outcomes and suggests that financial advice plays a key role in risk management and improving investment strategies.

Our specialised Superannuation team can help your client achieve their long-term financial goals. If you’d like to speak more about this with us, contact us on 03 8508 7800.

 

This information is general in nature and is provided by Partners Wealth Group. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information.