THE BEST performing Irish managed pension fund still lost 3.4 per cent of its value last month. As a group, managers saw a further 4.7 per cent wiped off their funds in November, bringing to 32.7 per cent the average loss in the market this year.
The continuing malaise in stock markets means the performance of the average Irish managed pension fund has considerably lagged inflation over the past 10 years.
The sector has recorded an average gain of just 0.8 per cent in that period, a full three percentage points behind the rate of inflation over the same period. Even Merrion Investment Managers, which has consistently managed to post positive returns over the longer term, is now lagging inflation with annual growth of 2.9 per cent.
KBC Asset Managers has, on average, lost 0.8 per cent of its value each year since November 1998.
Half of the funds monitored by Rubicon Investment Consultants are now recording losses over the past five years, with Bank of Ireland Asset Management suffering a 1.5 per cent decline, on average, each year since 2003.
The strongest return over the last five years has been recorded by Eagle Star, at 2.9 per cent per annum, compared to a sector average of just 0.3 per cent.
However, it is the recent performance that will give most cause for concern. Irish Life shed 5.7 per cent of its value last month and 36.2 per cent so far this year.
The average fund has lost 33.4 per cent over the past 12 months and an average of 8.5 per cent each year over the past three years.
Fiona Daly, managing director of Rubicon, acknowledged the pension fund performance this year was worrying but urged trustees and scheme members not to panic.
"Investing in real assets such as equities means accepting short-term volatility," she said. "It is only if a scheme winds up that these paper deficits actually materialise and schemes typically only wind up if the employer becomes insolvent."
The six funds that have been in the Irish market for more than 20 years have recorded an average gain of 6.6 per cent each year over that time.
