The founder of super ratings agency Chant West said Industry Super Network’s call for fund-level performance data would not meaningfully compare industry funds with retail funds, and said the difference between the interim data used by the agencies and the final crediting rate demanded by ISN was “miniscule”.
Industry Super Network yesterday called on APRA to immediately begin publishing fund-level performance data, and said the publication of 2008/9 super returns by private ratings agencies “highlighted the need for accurate and timely league tables using a methodology that both consumers and industry can have confidence in.”
Warren Chant said his criticism of the proposal had nothing to do with increased competition for him.
“The people that buy our data aren’t going to wait 12 months for APRA to put theirs’ out,” he said.
“My problem with it is, sure, fund-level performance data for industry funds is a reasonable proxy for the average member’s experience, because so many members are in the balanced default fund. But in retail you have no concept of a default fund, and you have a significant amount of money in conservative options, particularly where there is an allocated pension…industry funds will outperform under the fund-level methodology simply because their growth allocation is higher.”
Chant said the industry funds did not need a skewed survey to prove their worth.
“Chant West has been saying ‘industry funds outperform’ for years…but the Holy Grail is they want APRA to come out and say that.”
ISN yesterday also criticised the rating agencies for using different methodologies to calculate performance, and said their race to be first out with data meant they relied on interim numbers rather than final crediting rates.
Chant did not deny this. He said Chant West used to wait for final numbers, but that all changed in January when competitor SuperRatings was first to release calendar 2008 performance numbers.
“[SuperRatings founder Jeff Bresnahan] got blanket media coverage, we came out two weeks later with our numbers and of course got none. So now we wait until the 20th of the month [to get the previous month’s figures] – that’s the earliest day you will have a significant number. We’ve studied the difference between our interim figure and the final crediting rates, and it is miniscule,” Chant said, adding the bid to raise its profile was supported by the industry fund clients of its ‘Applecheck’ service.