Largest Pension Markets' Assets Double in 10 Years

January 24, 2007 ( - Assets in the 11 largest pension markets doubled to $23.2 trillion over the last decade, growing at a compound annual rate of 7.5%, according to Watson Wyatt Worldwide report.

The U.S. market led the pack, accounting for 60% of the global pension assets, followed by the Japanese and U.K. pension markets, according to a press release  from Watson Wyatt.

In 2006, pension assets rose by about 11% in local currency terms and just above 13% when measured in U.S. dollars, the Wyatt Watson report showed.

“While assets have clawed back a lot of ground in the past four years, liabilities have continued to increase because of mortality improvement and long-term bond yields. So despite improvements, it is still too early to characterize the global balance sheet as strong,” said Roger Urwin, global head of investment consulting at Watson Wyatt, in the press release.

Liabilities outpaced assets in the seven largest pension fund markets over the last 10 years, with liabilities rising by 37.5% and assets 34.4%. Between 1998 and 2002, liabilities outpaced the growth in fund assets, the report said.

According to Watson Wyatt, funds have increased their exposure to equities from 51.5% in 1996 to 60.2%, and have decreased exposure to bonds, from 36.5% to 25.5%.

A full copy of the report can be purchased here .