UK - Pension funds gambled on faster economic growth in the second quarter and posted their best returns since 1999, latest Russell/Mellon CAPS figures show.
Its latest pooled pension fund survey shows that in the three months to the end of June, the CAPS balanced median rose by 11.2% compared to the FTSE All-Share return of 13.6%.
But in the year to the end of June, the CAPS balanced median has still fallen by 6.7% showing that funds are still in negative territory over the last 12 months.
Bucking the shift from equities to bonds, the average equity weighting rose by 2.5 percentage points from 78% to 80.5%. At the same time, holdings in cash and fixed interest reduced significantly.
Holdings in UK fixed interest fell by 1.2 percentage points to 9.3%, allocations to overseas bonds fell by 0.4 points to 4.4% and cash holdings fell from 5.2% to 4.6%.
Poor relative performance was the predominant factor in each case.
Fund managers delivering the best performance over the quarter included Glasgow Investment Managers – a sharp turnaround for the £102m fund which ranked among the worst performers over the past three years. Its fund gained 16.2% in the three months to June 30, giving it a second place ranking over the period.
St James’s Place (GAM) fund was placed first with a gain of 23.2% and another of its funds – the THSP fund – came in third with a performance of 15.5%.
The worst performers over the quarter were the Neptune Balanced, BSI Generali and Skandia Prof Cautious funds which returned 6.2%, 6.6% and 6.8% respectively.
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