IRELAND - Irish managed pension funds returned an average of 5.8% in March, to produce an overall first quarter return of 5.9% on investments.

Figures from Rubicon Investment Consulting showed Irish Life Investment Managers posted the best performance with a return of 6.5%, while the lowest return of 4.7% came from Merrion Investment Managers.

The positive performance in March - attributed to a pick up in merger and acquisition activity along with equity market rallies caused by strong economic data - combined with the 1.4% return in February have offset the losses suffered at the start of the year. All 10 managed pension funds covered by the monthly survey reported a positive return of between 4.5% by Aviva Investors and 6.5% from Standard Life Investments.

Rubicon's figures showed the managed fund reported an average return of 36% over a 12-month period, with Irish Life Investment Managers topping the performance table with a 42.9% return and AIB Investment Managers posting the lowest return of 29.8%.

Over the longer term, the results are less promising as fund generated an average return of -6.9% over three years, 1.8% over five years and just 0.3% over the last decade. In, addition the monthly survey revealed four of the 10 funds produced negative returns over a 10-year period, with KBC Asset Management posting the worst result of -1.8%.

Elsewhere, the latest figures from Hewitt Associates' Managed Fund Index also reported an average return of 5.8% among the more than 20 funds in March 2010. This contributed to an average return of 6.2% for the year-to-date.

Brian Delaney, investment consultant at Hewitt, noted that March marked the one-year anniversary of the stock market recovery, and over the last 12 months the Hewitt Managed Fund Index returned 35.3%.

"The main driver of the return in March was the strong performance of international equity markets. Investors are responding to positive data from the US, particularly consumer spending which has improved over the last five months," he commented.

That said, Delaney warned the next test would be how markets react to the withdrawal of liquidity measures by governments and central banks.

"China and India have already taken steps to reduce liquidity, in an effort to curb inflation. There will also be continued focus on the debt of the weaker European countries," he added.

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