Overall, 2005 was good to KBC Asset Management (KBCAM), which finished the year with a flourish by delivering the highest return in December.

Chief investment officer Noel O'Halloran explains that the high equity levels maintained in the fund last year boosted its performance.

This overweight equity position was matched by being underweight in bonds.

The fund was overweight in European markets, and within Europe it was overweight in Irish equities.

KBCAM also took a strong position on emerging markets, particularly in southeast Asia.

However, it took a neutral position on Japan and shied away slightly from the United States and the United Kingdom.

Property was favoured over cash, and the fund's property portfolio consisted of industrial, office and retail investments in Ireland.

This was a lucrative decision, as the property sector produced a 23 per cent return in 2005.

Cash levels in the funds were appreciably lower than the benchmark, hovering between 0 per cent and 1 per cent.

"Basically we had no cash in the fund," says Mr O'Halloran. "Funds were fully invested throughout the year."

KBCAM uses the Garp (growth at a reasonable price) method of stock selection, which Mr O'Halloran describes as lying somewhere between value and growth investing.

It involves selecting stocks that are believed to be mispriced, but only if KBCAM can identify a positive growth outlook for such stocks.