PENSION funds are on the move again, after a year most would rather forget.
The median returns for retirement funds over the second quarter was 5.6 per cent, according to a survey released by the Wyatt Company.
This translates into a yearly return of over 20 per cent, well in advance of relevant inflation benchmarks. Over the last 12 years, price inflation has averaged 8.8 per cent and wage inflation 12.4 per cent.
Last year, pension funds were pulverised by disastrous conditions in regional equity markets and virtually all generated negative returns. The median return was a negative 13.3 per cent.
The first quarter of this year was also a poor one, with fund performance dragged down by the Mexican peso crisis and the Kobe earthquake.
Danny Quant, director and consulting actuary of the Wyatt Company, said the result for the second quarter was a good one by historical standards.
Aside from the outliers, the spread of returns from the funds was relatively narrow.
