Superannuation Fees and Asset Allocation

36 Pages Posted: 9 Aug 2016

See all articles by Andrew Ainsworth

Andrew Ainsworth

University of Wollongong - School of Accounting, Economics & Finance; Financial Research Network (FIRN)

Shumi M. Akhtar

The University of Sydney

Adam James Corbett

The University of Sydney - Discipline of Finance; Financial Research Network (FIRN)

Adrian D. Lee

Deakin University - Department of Finance (Property and Real Estate); Financial Research Network (FIRN)

Terry S. Walter

University of Sydney; University of Technology, Sydney - School of Finance and Economics; Financial Research Network (FIRN)

Date Written: July 26, 2016

Abstract

There is considerable debate about the size of fees charged by superannuation funds. This paper investigates both investment fees and administration fees and shows that there are economically valid reasons why most investment fees are set at their current level. Our results show that on average, retail funds are charging both higher investment fees and administration fees than other funds. A defence of higher administration fees can be easily achieved given the opacity that surrounds this fee type. However, it is difficult to justify why investment fees are higher, on average, when the cost (i.e., riskiness) of asset classes is incorporated into our analysis.

Keywords: Superannuation funds, investment fees, administration fees, asset allocation

Suggested Citation

Ainsworth, Andrew and Akhtar, Shumi M. and Corbett, Adam James and Lee, Adrian D. and Walter, Terry Stirling, Superannuation Fees and Asset Allocation (July 26, 2016). CIFR Paper No. 114/2016. Available at SSRN: https://ssrn.com/abstract=2814790 or http://dx.doi.org/10.2139/ssrn.2814790

Andrew Ainsworth (Contact Author)

University of Wollongong - School of Accounting, Economics & Finance ( email )

Northfields Avenue
Wollongong, NSW 2522
Australia

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

HOME PAGE: http://www.firn.org.au

Shumi M. Akhtar

The University of Sydney ( email )

University of Sydney Business School
corner of Codrington Street and Darlington Street
Chippendale, NSW 2006
Australia
61290369309 (Phone)

HOME PAGE: http://www.firn.org.au

Adam James Corbett

The University of Sydney - Discipline of Finance ( email )

P.O. Box H58
Sydney, NSW 2006
Australia

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

Adrian D. Lee

Deakin University - Department of Finance (Property and Real Estate) ( email )

70 Elgar Road
Melbourne, VIC 3125
Australia

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

HOME PAGE: http://www.firn.org.au

Terry Stirling Walter

University of Sydney ( email )

P.O. Box H58
Sydney, NSW 2006
Australia

University of Technology, Sydney - School of Finance and Economics ( email )

Haymarket
Sydney, NSW 2007
Australia
+61 2 9514 3860 (Phone)
+61 2 9514 7711 (Fax)

HOME PAGE: http://datasearch.uts.edu.au/business/finance/staff/StaffDetails.cfm?UnitStaffId=5373

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

HOME PAGE: http://www.firn.org.au

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