CANADA - Buoyed by healthy fourth quarter performance, Canadian balanced funds posted a return of 10.1% in 2004, according to Royal Bank of Canada Global Services (RBC).
RBC, which maintains the industry’s universe of Canadian pension plan and money managers, said Canadian pension funds returned double-digits for a second consecutive year.
According to results of the quarterly survey released by BENCHMARK(R), the investment analytics arm of RBC, balanced funds within the CAN$340bn BENCHMARK(R) universe returned 5.3% in the quarter ending December 2004.
“This year, as last year, markets rallied in the final quarter,” said Don McDougall, director, BENCHMARK, RBC. “Half the annual gains were concentrated in those final three months - a strong finish, however, 2004 did not quite match the 13.5% annual return posted in 2003.
Canadian equities – the top-performing asset class for the last seven quarters – returned 15.7% in 2004. Active managers outperformed the market by 1.2%, capturing superior returns in materials and industrials, while maintaining exposure to the energy and financial sectors, RBC said.
McDougall added: “2004 was not just about equities. Low interest rates buoyed domestic bonds.”
Canadian fixed income managers averaged 7.2% over the year, keeping pace with the Scotia Capital Universe Bond Index, RBC said.
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