DOUBTS ABOUT the prospects for economic growth hung over stock markets in June, leading pension funds to a second successive month of losses.
The average Irish managed fund reported a loss of 1.6 per cent in its value, according to figures published yesterday.
This comes on top of a 2.8 per cent decline in value, on average, in May.
The poor second quarter means that the average Irish pension fund is once again in the red over the last five years – with returns over that time of -0.2 per cent per annum even before allowing for inflation.
Even over the longer 10-year period, average returns are just 0.3 per cent, well below the 2.5 per cent prevailing rate of inflation.
Four managers have recorded negative returns over the past decade, including an average loss of 1.9 per cent each year at KBC Asset Management (KBCAM) .
The best performers over this longer term continue to be Zurich/Eagle Star (1.8 per cent per annum), Merrion Investment Managers (formerly Oppenheim) at 1.4 per cent each year and Irish Life Investment Managers at 1.3 per cent. However, none of them have managed to outperform the consumer price index.
Since June 1990, Zurich/Eagle Star is by far the best performer with an average annual return of 10 per cent reflecting the benefits from the early years of the Celtic Tiger.
Most other fund managers are clustered reasonably closely around the 6.8 per cent per annum average for the period. Merrion has not been in the market long enough to feature over this term.
So far this year the average fund has returned growth of 1.9 per cent on the back of a strong first quarter.
Standard Life Investments has led the way with a gain of 3.7 per cent, helped it part by limiting its losses in the second quarter to 2.6 per cent – better than its rivals.
Canada Life/Setanta, Bank of Ireland Asset Management and Irish Life all suffered setbacks of over 4 per cent in the second three months of the year.
However, Aviva remains the poorest performer over the first half of 2010, with a gain of just 0.4 per cent.
