For Australians navigating the maze of managed funds, superannuation options, and ETFs, reliable benchmarks are critical. Enter the Lipper Indexes—one of the world’s most trusted tools for comparing fund performance. With Australia’s managed funds sector surpassing $4.6 trillion in 2025 and APRA’s regulatory tightening on performance disclosures, understanding Lipper Indexes is more vital than ever for investors looking to optimise returns and avoid underperformers.
What Are Lipper Indexes and Why Do They Matter?
Lipper Indexes, developed by LSEG Lipper (formerly Refinitiv), are a family of indices that track the performance of various types of mutual funds and ETFs globally. They serve as benchmarks, enabling investors to compare the returns of a specific fund or portfolio against the broader market or a peer group with similar investment mandates.
- Comprehensive Coverage: Lipper Indexes span a wide range of asset classes—equities, fixed income, mixed assets, and more—across global and regional markets.
- Peer Group Benchmarking: Unlike market indices (like the S&P/ASX 200), Lipper Indexes allow you to compare ‘apples with apples’ by grouping funds with similar objectives and risk profiles.
- Performance Transparency: In 2025, ASIC’s enhanced disclosure requirements mean fund managers must justify performance using recognised benchmarks like Lipper Indexes, boosting transparency for retail investors.
How Lipper Indexes Are Used by Australian Investors
Lipper Indexes have become a staple in the toolkit of Australian financial advisers, super funds, and self-directed investors. Here’s how they’re applied in practice:
- Super Fund Comparison: With the ATO’s YourSuper comparison tool now incorporating Lipper data, Australians can see at a glance how their super funds stack up against the sector median and best-in-class performers.
- ETF Selection: ETFs tracking Lipper Indexes, such as those focused on Australian dividend equities or global infrastructure, offer a passive way to mirror the performance of well-defined fund peer groups.
- Spotting Underperformers: The Federal Government’s 2025 “Performance Heatmap” leverages Lipper Indexes to flag underperforming managed funds, prompting review or closure—a move that’s already seen $12bn shift away from chronic laggards.
For example, an Australian equity growth fund might be benchmarked against the Lipper Australia Equity General Index. If the fund consistently lags this index over rolling five-year periods, advisers and investors are now more likely to question its fees or suitability.
Lipper Indexes and the 2025 Regulatory Landscape
The landscape for fund reporting and benchmarking in Australia has evolved rapidly. Here’s what’s new in 2025 and how Lipper Indexes are intertwined with these changes:
- Mandatory Benchmark Reporting: APRA and ASIC now require managed funds to disclose not just their own returns, but also performance versus a ‘peer group index’—with Lipper Indexes cited in the majority of Product Disclosure Statements (PDS) for new retail funds.
- Fee Transparency: The 2025 ‘Fee vs Performance’ dashboard requires all super funds and managed investment schemes to display net performance against Lipper Indexes, making it easier for members to spot when high fees aren’t justified by outperformance.
- Responsible Investing: Lipper has expanded its suite of ESG (Environmental, Social, Governance) indexes, which Australian ethical super funds are increasingly using to benchmark their sustainability claims and performance.
These regulatory shifts mean Australians can compare funds with more confidence, using Lipper Indexes as a reliable yardstick. It also puts heat on fund managers to justify their strategies and costs in an era of rising transparency.
Real-World Example: Using Lipper Indexes to Make Smarter Choices
Suppose you’re weighing up two popular Australian fixed income managed funds. Fund A claims a 5.2% annualised return, while Fund B posts 5.6%. On the surface, Fund B looks superior. But the Lipper Australia Bond Index shows the sector average return is 6.0% for the same period. Suddenly, both funds look less attractive, and you might instead consider a low-cost ETF that closely tracks the index. This approach—benchmarking against the Lipper Index—helps cut through marketing noise and focus on true value-add.
The Future of Lipper Indexes in Australia
With the ongoing digitalisation of financial advice, expect Lipper Indexes to become even more embedded in online comparison tools, robo-advice platforms, and superannuation dashboards. Their role will only grow as Australians demand more data-driven insights and accountability from fund managers. The key takeaway? Smart investors in 2025 don’t just chase past performance—they benchmark, compare, and demand transparency, using tools like Lipper Indexes as their financial compass.
