IRELAND - Irish pension fund returns remained flat in January 2011, research by Aon Hewitt shows.
The Aon Hewitt Managed Index, an index of traditional managed pension funds, rose by just 0.2% in January while bond yields continued to rise, reducing the liabilities of defined benefit schemes.
Eurozone shares were the strongest performing region, returning 4.7%, but dampened the returns of other regions, with the World ex Eurozone returning -1.4%. The euro gained 2.3% against the US dollar and 3.4% against the Japanese yen in the same month.
Aon Hewitt senior investment consultant Denis Lyons said: "The simultaneous rise in equities and bond yields over recent months has seen an improvement in many pension schemes' funding levels. In such cases, trustees may wish to consider adjusting the risk profile of the portfolio to lock in some of the recent gains.
"Developed equity markets posted small gains in the first month of the year. The S&P 500 returned 2.3% for the month, with investors confident in the US economy following generally positive earnings releases. However, the recovery in the value of the euro reduced the effect of these gains for euro based investors."
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