Nine in 10 high-risk pension funds fail to beat FTSE 100 over five years

"Nearly nine in 10 higher-risk pension funds have failed to match the performance of the FTSE 100 over the past five years, according to new analysis that raises fresh concerns about retirement outcomes for millions of savers. Research by Investing Insiders examined almost 13,000 personal and workplace pension funds holding more than £1tn in assets between December 31, 2020 and December 31, 2025. Funds in the medium-high and high-risk categories were benchmarked against the FTSE 100 over the same period."

"The FTSE 100 delivered cumulative returns of 84.67 per cent over five years, turning £20,000 into £36,934 and £50,000 into £92,335. By contrast, 89 per cent of pension funds in the higher-risk categories underperformed that benchmark. Of 7,370 funds analysed at these risk levels, 6,540 failed to keep pace with the index. The worst-performing fund in the study, Zurich Assurance's Zurich JPM Emerging Europe Equity Pn ZP GTR in GB, lost 98.59 per cent of its value over five years."

"Other underperformers included funds linked to the collapsed Woodford Equity Income strategy and several UK property-focused vehicles, many of which suffered heavy losses during periods of market stress. All of the 10 worst-performing funds were categorised as high risk, and 87.6 per cent of the 1,418 funds in that bracket failed to beat the benchmark. Investing Insiders estimates that the gap between the best and worst performers could equate to a difference of £139,000 on a £50,000 contribution over the same period."

Almost 13,000 personal and workplace pension funds holding more than £1tn in assets were examined between December 31, 2020 and December 31, 2025. Funds in the medium-high and high-risk categories were benchmarked against the FTSE 100. The FTSE 100 returned 84.67 per cent cumulatively over five years, increasing £20,000 to £36,934 and £50,000 to £92,335. Eighty-nine per cent of higher-risk pension funds underperformed the FTSE 100; 6,540 of 7,370 funds failed to keep pace. The worst fund lost 98.59 per cent of value, while the best returned 180.28 per cent, growing £50,000 to £140,140. The disparity could equal £139,000 on a £50,000 contribution.

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