Assets in U.K. employer-sponsored pension funds rose 23.9% in the year ended Dec. 31, according to an annual estimate by UBS Global Asset Management.
U.K. equities, which constitute 24% of pension assets on average, bounced back from being the worst-performing asset class in 2008 to the best in 2009, rising 30.1%, according to UBS’ Pension Fund Indicators report, released Thursday. Despite recent volatility, U.K. equities have returned an annualized 12.1% since 1962, the earliest year of UBS’ records.
Despite the performance gains, U.K. institutional investors pared equity allocations in 2009 to 54% of total assets. Average levels of overseas and U.K. equities each fell one percentage point to 30% and 24% of total assets, respectively.
Bonds were the beneficiaries of the moves, with average levels of U.K. bonds and index-linked gilts each rising one percentage point to 18% and 13% of total assets, respectively.
Average levels of real estate, overseas bonds and cash/other held at 7%, 5% and 3%, respectively, the same levels as in 2008.
UBS bases its total asset and allocation estimates on data from a number of sources; returns estimates are based on market data.