• More: (1 of 7)


Actuarial Exponents, Inc. has updated its annual investment performance survey to provide clients with additional basis for benchmarking returns on retirement funds and portfolio allocation.

This year's study covers the years 2011 to 2012. In 2010, the study involved P 3.5 Billion in retirement funds under trust from 30 companies. In 2011, it covered P 4.0 Billion of retirement funds from 37 companies and P 6.3 Billion of the same funds from 40 companies in 2012.

The survey shows that retirement fund assets were mostly invested in government bonds and other fixed income securities (77% in 2010, 63% in 2011 and 64% in 2012). Result shows an increasing trend in percentage of retirement fund assets in equities for the past three years most probably due to more positive stock market outlook (or simply that the previous year's equity allocation appreciated in value) and the lack of alternative investments that provide high returns.

Large funds give higher allocation to equities and mutual funds while small funds stick to government securities and short-term deposits.

The overall simple average estimated rates of return on retirement funds, net of trusteeship / investment management fee, are 10.8% in 2010, 8.7% in 2011 and 9.0% in 2012. These rates are based on market valuation of fund assets. Using weighted averaging, the rates of return are 13.8% in 2010, 10.0% in 2011 and 11.1% in 2012.

In light of the continuous decline in interest rates and the risk involved in investing in equities and even mutual funds / unit investment trust funds (UITF), companies may look at asset-liability management and employee loan to increase the yield of the retirement funds.

The survey shows comprehensive statistics on asset allocation and actual rate of return (based on simple and weighted averaging) as well as benchmark rates.

Soft copies of the survey have been released to clients and participants. Hard copy of the survey will be included in the actuarial valuation reports provided by ActuarialExponents.