Different types of superannuation and who invests the money

People often say my super fund has performed good this year or my super fund has performed bad.

Really to be technically correct - I think you should say my investments I have chosen (or not chosen as it was default) inside my super fund has performed good - or my investments that I have chosen inside my super fund have performed bad.

Superannuation is just an investment vehicle where you can hold investments inside.

There are many types of structures like industry funds where generally there is only 10 or so investment choices (some have more and some less), then there are retail funds where investment choices can be in the 100’s or self-managed super funds where there is almost unlimited (provided they meet the governing rules of an SMSF).

Sometimes superannuation funds like industry funds’ will manage the majority of the money themselves in their “pre-mixed or blended” options. Effectively meaning they employ people to physically buy and sell shares and other investments on behalf of the members. Other industry funds such may only manage a small portion of members money “in-house” and the rest they will employ people to find other institutions or businesses to “buy and sell shares” put simply.

With retail funds - there can be a mix, some providers may have some investments they manage themselves but a lot of the investment options are generally external to the actual fund where you pay administration fees to and have nothing to do with the “super fund” itself. So performance from one client to the other can be very different and it really just depends what you are invested in.

It is important to have a fundamental understanding of what is happening with your super, who is managing the money and what fees you are paying for what level of service that relates to investments or just administration of the fund.