UK - With close to a 50% market return, investing in emerging markets has helped UK pensions funds achieve an average 2005 performance of 18.2%.
According to Mellon Analytical Solutions (MAS) the strong performance in 2005 was driven by high returns in each of the major equity markets. Emerging market achieved a 49.9% return, Japan, 39.6% and Pacific ex Japan hit 28.6% and were the strongest performers.
UK equities remains the single biggest asset class for UK pension fund investment and achieved a market return of 22.0% over the year. Europe ex UK equities and US equities also performed well returning 23.6% and 18.7% respectively.
Property also chipped in returning 17%.
According to MAS, over three years, pension achieved an estimate weighted average of 14.8% p.a. As measured by the RPI this return was “comfortably ahead of inflation” which ran at an estimated 2.8%.
MAS publications and statistics manager Daniel Hall said: “By the end of 2004, pension funds had got back to where they were at the start of the decade, in terms of fund value. This year they have finally started to move ahead.
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