UK – The average balanced, pooled pension fund returned +15% in the first 11 months of 2003, according to new data from HSBC.
The figure contrasts with a –14.7% return in the same period a year ago, said HSBC Actuaries and Consultants’ IMAGE survey.
“It looks certain that the run of consecutive negative returns in 2000, 2001 and 2002 has been halted,” said HSBC’s head of manager research, Paul Watson.
He added: “To perform well in 2003 required managers to overweight their position in equities relative to bonds, property and cash – and this was in total contrast to 2002.
“Better equity returns were achieved by weighting towards the mid and small cap stocks which have outperformed large caps by almost 20 per cent in 2003.
“We have seen many investment managers increasing their risk on portfolios as the year draws to a close, indicating a greater optimism on equities for 2004 and beyond.
“While many managers have increased their exposure to mid and small cap, foreseeing greater returns from an economic recovery, this has not been at the expense of the very top end of the UK stock market.
HSBC said the five best performing managers were Glasgow Investment Managers, Swiss Life, Newton, Tilney and UBS. The five worst performing managers were: Allianz Dresdner Asset Management, Bank of Ireland, KBC, Royal London and CSAM.
In the first 10 months, the funds returned an average 14.1%.