Trusteed pension funds reported their first positive cash flow in more than a year during the second quarter of 2003, according to Statistics Canada.

These funds had estimated revenues of $14.9 billion and expenditures of $11.3 billion in the second quarter. The funds had a net income of nearly $3.7 billion, the first positive balance since the first quarter of 2002. It has also been this long since the funds made a profit rather than a loss from the sale of stocks, StatsCan says.

The value of the funds’ assets increased from $518.2 billion to $553.6 billion in the second quarter, a 6.8% gain. About 38% of fund assets were invested in stocks. Typically, the value of fund assets increase or decrease as stock prices rise or fall, and this was the case in the second quarter. The S&P/TSX gained 10% in value over that period.

The increase in fund assets was also due to the increased value of their bond holdings, but to a lesser extent than the increase in the value of their stocks. Bonds represented 37% of the funds’ total value.

Since the fourth quarter of 1999, trusteed pension fund managers have been slowly shifting their holdings from an emphasis on stocks to a more even split between stocks and bonds.