AbstractBerk and Green propose a model of a superannuation fund industry, with a limited population of superior fund managers and a competitive investor market. In this market, superior fund managers capture the value they generate, leaving investors with a normal return on their investment. Furthermore, it is argued that previous period returns, age of the fund and management costs explain variation in net cash flow paid into a fund over time. The Berk and Green predictions find some support in empirical tests, reported in the present paper, based on Australian Morningstar retail and wholesale equity fund data over the period 1995–2005.