The Size, Cost and Asset Allocation of Australian Self-Managed Superannuation Funds

31 Pages Posted: 10 Jul 2014

See all articles by Bruce Robert Arnold

Bruce Robert Arnold

University of Technology Sydney (UTS) - Faculty of Business; UNSW Australia Business School, School of Banking and Finance; Australian Prudential Regulation Authority

Hazel Bateman

UNSW Sydney, CEPAR

Andrew Ferguson

Department of Accounting, UTS

Adrian Raftery

Deakin Business School

Date Written: July 8, 2014

Abstract

Using proprietary Australian Tax Office (ATO) data, we document the size, asset allocation and expenses for a sample of 209,420 Australian self-managed superannuation funds (SMSFs) for the three years to June 2010. Two recent Government reviews have highlighted a lack of basic knowledge of the costs associated with running an SMSF. Our study aims to address this paucity of research in relation to SMSF’s and has two objectives. First, on a descriptive level we provide evidence on the size and asset allocation of SMSF’s. Secondly, on an empirical level, we specify a model of SMSF costs. On a descriptive level we find heterogeneity amongst SMSFs in terms of both size and asset allocation. Further, our empirical analysis suggests cost advantages in running an SMSF. The analysis provides new insights into the fastest growing and largest segment of the Australian $1.83 trillion retirement savings industry and extends prior superannuation studies of both small and large APRA funds to SMSFs.

Keywords: self-managed superannuation funds, pension funds, asset allocation, SMSF costs

Suggested Citation

Arnold, Bruce Robert and Bateman, Hazel and Ferguson, Andrew and Raftery, Adrian, The Size, Cost and Asset Allocation of Australian Self-Managed Superannuation Funds (July 8, 2014). CIFR Paper No. 033/2014. Available at SSRN: https://ssrn.com/abstract=2463886 or http://dx.doi.org/10.2139/ssrn.2463886

Bruce Robert Arnold (Contact Author)

University of Technology Sydney (UTS) - Faculty of Business ( email )

Australia

UNSW Australia Business School, School of Banking and Finance ( email )

Sydney, NSW 2052
Australia

Australian Prudential Regulation Authority ( email )

400 George Street
Sydney, NSW 2000
Australia

Hazel Bateman

UNSW Sydney, CEPAR ( email )

High Street
Sydney, NSW 2052
Australia

Andrew Ferguson

Department of Accounting, UTS ( email )

PO Box 123 Broadway
Sydney, NSW 2007
Australia
61 2 9514 3565 (Phone)

Adrian Raftery

Deakin Business School ( email )

221 Burwood Highway
Burwood, Victoria 3125
Australia
+61-3-92446643 (Phone)

HOME PAGE: http://www.deakin.edu.au/profiles/adrian-raftery

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