CANADA - Canadian balanced pension funds posted an 11.7% gain for 2005, the third successive double-digit year, according to a survey by BENCHMARK, the investment analytics arm of RBC Dexia Investor Services.
According to the survey, Canadian equities remained the top-performing asset class in 2005 and helped lift pension plans on the strength of a 63.4% return in energy stocks, which accounted for nearly half of the market’s 24.1 % gain in 2005.
Active managers also sustained good pace with the market despite remaining under exposed to the energy sector over the year.
“That’s three consecutive years, since the tech bubble in 2002, that longer term assets have performed extremely well,” exclaimed Don McDougall, director at BENCHMARK.
Global stock markets also continued to do well, pushing the annual MSCI World index to 15.8% in local currency. The survey noted Canadian-based investors continued appreciated of the loonie slashed foreign equity returns to a low of 6%.
“The loonie has been a major factor over the past three years, first against the US Dollar in 2003 and 2004 and this year against the Yen and Euro,” McDougall said.
Fixed income managers also posted an average 6.5% return matching the Scotia Capital Universe Bond Index.
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