Pension funds, so badly hit in the downturn, have shown their fifth consecutive monthly improvement, according to Hewitt Associates, a global human resources services company.
Its monthly managed fund index, an indicator of Irish Pension Managed Fund performance, for July, shows a +5.7% return for the month.
Deborah Reidy, investment consultant with the fund, said the Irish Life managed fund was the best performing fund for the month with a return of +7.1%.
The Eagle Star managed fund was still the best performing managed fund compared to its peers over a one year, three year and 5 year time horizon.
The average managed fund was +5.6% for the month.
The lowest performing fund was the Acorn Life managed fund with a return of +4.0%.
The average return on Irish managed funds for the last 12 months was -12.4%.
The equity market rally which has been taking place over the past few months continued last month. This had helped the performances of Irish pension funds.
The return of the Hewitt Index for the first seven months of 2009 was now +11.4%.
The gains recorded in July could be attributed to more positive economic data and company earnings results for the first half of the year, said Deborah.
Record breaking results posted by JP Morgan and Goldman Sachs for the first half of the year had resulted in many investors hoping the financial crisis of the past two years might be behind us.
Other market heavyweights had also boosted their earnings forecasts based on what they saw as evidence that international stimulus plans, particularly in China, were beginning to work.
The consensus was being formed at the moment that the estimated $1.7 trillion (€1.19 trillion) being pumped into economies worldwide should be enough to start a recovery.
The so called ‘fear index’, as measured by the credit rating agency Standard Poor’s, implied that market volatility was currently trading back at pre-financial meltdown levels.