Despite a year-end rally Irish pension funds fell by 5.6 per cent in 2001. While the average Irish pension managed fund rose by 9.8 per cent in the last quarter of 2001, this was not sufficient to bring returns into positive territory for the full-year period. For the same period in 2000, Irish pension funds rose by 2.6 per cent.
‘There is little doubt that investors will be glad to see the back of 2001. The average managed fund under performed the annual rate of inflation by over 8 per cent, resulting in a considerable negative real return for investors,’ said Tom Murphy, head of Mercer’s investment practice. ‘While we saw sporadic rallies in equity markets throughout the year, they simply weren’t enough to outweigh the declines; for the first time in twenty seven years we have witnessed two consecutive years of negative returns from the global market.’
The Pacific Basin was the only equity market in positive territory for the year (+2.3 per cent), following a 29.8 per cent rise in the final quarter. The Irish equity market, up 12.6 per cent for the final three months, yet again performed strongly on a relative basis despite a marginal loss for the year (0.1 per cent).
Despite economic concerns, the tragic events of September 11th and the subsequent decline in US consumer confidence, the North American equity market performed well relative to its global peers during 2001, although it still fell by 8.1 per cent for the year. The hardest hit equity indices for the year were Japan (-25.4 per cent) and the Euro land Region (-17.9 per cent).
Bank of Ireland Asset Management (-2.2 per cent) and New Ireland (-2.3 per cent) topped the table for the full-year returns, outperforming the average return of -5.6 per cent. The under performers were Canada Life/Setanta and Baillie Gifford who both returned -8.4 per cent.
According to Murphy, ‘The top performers were those managers who maintained a light equity weighting over the course for the year, as well as strong positions in both fixed interest and property which significantly outperformed their equity counterparts over the period,’ he added.
For the five-year period to date, Montgomery Oppenheim (+18.2 per cent per annum) and New Ireland (+15.1 per cent per annum), are top against an average return of 13.3 per cent per annum. Standard Life lag their peers over this period returning -10.6 per cent per annum.
Over the 10-year period New Ireland hold the top position with a 14.1 per cent per annum return, closely followed by the Hibernian (NU) Managed Fund, which returned 14 per cent per annum for the period. Irish Life lagged over the 10-year period returning 12 per cent per annum against the average return of 13.2 per cent per annum. |
