An extra €3 billion could have been invested in Irish shares but for the advent of the euro, according to KBC Asset Management chief economist Eoin Fahy. His figure is based on the difference between the proportion of the assets of Irish pension funds invested in Irish equities today and before the announcement of the euro.

At the end of 1997, some 30.6 per cent of Irish fund assets was invested in Irish shares compared with 19.5 per cent in mid-2001. Investments in Irish bonds dropped from 16 per cent to 6 per cent. But Mr Fahy pointed out that investors need a greater range of firms and sectors to diversify risk.