U.K. pension funds averaged an overall equity investment return of about 11% in 2004, according to a survey of about two-thirds of U.K. pension funds conducted by WM Co., the European performance measurement division of State Street Corp. The survey, which included public and private pension funds, found that U.K. equity investments had an average return of nearly 13%, while their non-U.K. equity investments gained more than 10%, according to a press release. The funds' U.K. bond investments posted an average return of about 7% in 2004, while their non-U.K. bond investments rose nearly 5%. U.K. pension funds' real estate investments averaged almost 19% for the year.
U.K. pension funds continued to shift from U.K. equities to bonds and non-U.K. equities. Total equity allocations fell to 65%, down 10% from five years earlier, according to the survey.
U.K. pension funds "are still suffering the effects of the severe equity bear market between 2000 and 2002," Michael S. Walsh, managing director at WM, said in a statement.
Stephen Connelly, WM spokesman, did not return a call seeking comment by press time.