SWITZERLAND - The median performance of Swiss public and private pension funds for 2002 was -10.3%, according to analysis by Watson Wyatt on over 600 investment mandates with combined value exceeding CHF75bn in assets.
However, the total return of the pension funds could be slightly better, as direct real estate investments were not included in the analysis due to valuation complexities.
The combined returns of the Swiss pension market were negative for the year, though when compared to other nations’ pensions markets they performed quite well. The UK pension market returned -18.1% in GBP (source: Russell Mellon Caps). The return difference can mainly be attributed to a lower average percentage of equities held by Swiss pension funds.
For 2002, the variation in returns among Swiss pension funds increased. The difference between the top 5% of total returns and the bottom 5% was 17% (2001: 12.8%).
Overall asset allocation at year end shows a decrease in Swiss equities of 4% with a corresponding increase in allocation to Swiss bonds increased their allocation by the same percentage over the same time period.
Despite the negative return of the MSCI World Index (-33.3%), the allocation to international equities remained relatively stable, indicating that Swiss pension funds invested heavily within this asset class over the period.
The performance comparison has been conducted on behalf of the Swiss Pension Fund Association (ASIP), by Watson Wyatt since the beginning of 2000.
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