4.1% return on segregated pension funds for first half of 2003
CPMS surveys the larger employer sponsored pension schemes in Ireland.
During the first half of 2003, CPMS measured and analysed the performance of approximately 200 Irish pension funds with an asset base in excess of €19bn.
This survey differs from the quarterly survey published by Mercer, which compares the performance of unitised Irish pension managed funds. These funds are used by smaller employer sponsored pension schemes.
Tom Geraghty of Mercer said the positive year-to-date return posted by each of the managers has provided some welcome relief to investors.
"These figures, however, reflect a six-month period of high volatility, as equity markets continued to fall throughout the months leading up to war in Iraq, followed by a pretty sharp recovery (equity markets rose by 11.6%) over the three months of quarter two," he said.
"While equity markets benefited from renewed investor optimism, however, bond markets also continued to perform solidly. Therefore, the asset allocation decision between equities and bonds was not the chief differentiator between managers' returns. The key factor was the stock selection employed by managers the resurgent performance of some TMT-related and economically sensitive stocks in quarter two (particularly small to medium capitalisation stocks) boosted the returns of managers that maintained a strong holding in these sectors of the market and had anticipated this bounce."
Of the 10 managers that make up the CPMS Manager Average, Irish Life Investment Managers topped the table for the first six months of 2003 with a return of 5.5%. The worst performing CPMS manager for the period was KBC Asset Management, who lost ground during quarter one as markets continued to fall.
Despite the recent strong gains, however, medium term pension fund returns remain in negative territory.
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