Administration February 1, 2004

UK Plans End Three Down Years With 15.8% 2003 Advance

January 2, 2004 (PLANSPONSOR.com) - Three years of investment losses by UK pension plans came to an end with a 15.8% gain in 2003 as the UK plans enjoyed their best year since 1999, investment services firm Russell/Mellon CAPS reported.
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Dow Jones reported that according to Russell/Mellon CAPS, the strong 2003 performance was driven by double-digit returns in each of the major global markets:

  • UK equities returned 20.9%
  • Continental European markets added 29.3%
  • Japanese equities rose 22.8%
  • US stocks returned 15.1%.

The strongest overseas performers last year were emerging markets, advancing 40.1%, and the Pacific region excluding Japan, which turned in a 31% gain.

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In 2003, index-linked bonds returned 6.6%, overseas bonds 3%, property 7.6% and cash 3.5% – all improvements on 2002.

Over the three years up to December 31, the funds have fallen an average 2.8% a year, the research firm said. Over five years, they’ve produced a positive average annual return of 1.8%, rising to an average 6.3% annualy over the previous 10 years.

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