Super funds faced a tougher market in October, with most asset classes reporting negative returns, except international shares and cash. However, according to SuperRatings, the overall score is still quite positive.

Namely, the firm estimated that the average balanced option gained 0.2% in October, while the average growth option added about 0.4% and the average stable equity declined 0.3%.

Speaking to InvestorDaily, SuperRatings director Kirby Rappel said that moving forward, members should prepare for market volatility amid stable interest rates and Trump’s re-election.

"People are probably a bit more concerned about the economic environment and it does feel tough, but I think the positive is that super funds will continue to drive that," Rappel said.

"I think it's really comforting for most people that funds have done pretty well with the economic uncertainty since 1992. this way.'

Discussing the potential volatility, the SuperRatings director noted that much depends on whether Trump's proposed policies are fully implemented over the next four years.

Rappel also stressed that in an environment of higher volatility, it is critical that fund members understand what their long-term risk profile is and "stick to it."

"We can't control short-term movements, so for many members it's about ensuring they have an understanding of how much risk they can take, or using the fund's risk profiling tools and then adjusting their strategy to consider it in the long run," he said.

"Hopefully this allows members to block out the shorter-term noise."

Rappell pointed to data showing that since 2000 so far, calendar year super fund returns have averaged around 6.2 per cent per annum and there have been only four negative returns.

"This period includes the dotcom bubble, the GFC and COVID," he said.

"So I think people will be on the lookout for a potential increase in volatility, hopefully staying focused on the long term with the risk profile in line with what's right for them."

The media balance option has seen a negative return in 2002. (-4.8%), 2008 (-19.7%), 2011 (-1.9%) and in 2022. (-4.8%), according to the data.

Concerns that core inflation remains stubbornly above the RBA's target, as seen in September's printed consumer price index, have shifted the outlook for a rate cut in Australia next year.

In line with market expectations, earlier this month the RBA announced another rate hold, leaving the cash rate unchanged at 4.35% for the eighth time in a row.

This has reinforced market expectations that a rate cut is unlikely in the near future.

As such, Rappell expressed concern that higher mortgage and rental costs, if extended, could weigh on members' living costs, with potential inflationary pressures from promised rates further exacerbating the situation.

No significant change

Earlier this month, and before Trump's election victory, Joshua Loewen, manager of analysis at SuperRatings, told InvestorDaily that the outcome of the US election was unlikely to lead to a significant change in the investment strategies of pension funds.

"This is because these strategies are designed with long-term investment horizons, usually at least 10 years, and therefore, while the outcome of the election may have an impact on some specific assets in which the funds invest, at a strategic level it is unlikely to have big impact on long-term outcomes,” Loewen said.

However, investment teams will remain vigilant, closely monitoring potential changes in US policy and their implications for equity markets.

“The Funds and their investment teams or managers will consider likely changes in US policy and any expected impact on US equity markets due to the outcome of the presidential election as they seek to take advantage of any opportunities that may arise; however, fund responses in this regard would be similar to those made in response to any major global event,” he said at the time.