Managed pension funds staged a modest recovery last month, with the expectation of a cut in US rates offsetting the effect on global equity markets of disappointing results from a number of bellwether US stocks.
Returns among the 10 main managed Irish funds ranged from 0.8 per cent at Bank of Ireland Asset Management to 2.3 per cent at Eagle Star and Standard Life, according to investment consultants Rubicon.
Despite the gains recorded in October, which came before the current bout of market jitters, pension funds have made little progress this year. AIB is the best performing manager for the year to date, with a return of 6.5 per cent. The poorest performance came from Bank of Ireland Asset Management which has returned -1.7 per cent, the only manager in negative territory. The average for the period is 3.1 per cent.
Five-year returns remain strong, according to Rubicon, averaging 11.4 per cent, with Eagle Star the strongest performer at 12.7 per cent.
Global equity markets experienced continued uncertainty last month, according to Rubicon, buffeted by disappointing earnings from major US corporations, rocketing oil prices and strong commodity prices.
Gold reached a 28-year high as investors sought safe-haven assets.
Against this, equity markets were propped up by the expectation of a cut in US interest rates, which was announced as expected on the last day of the month. Markets also drew some succour from the less hawkish stance adopted during the month by European Central Bank president Jean Claude Trichet.
The strong oil and commodity prices pushed some Asia Pacific markets to record heights , while the dollar hit a record low against the euro. "Volatility in equity markets led investors to continue seeking out less risky assets, predominantly government bonds," according to Rubicon.
