South Africans invested in pension funds have been less prejudiced by the global financial meltdown than those who invested directly in equities.
Pension funds lost an average of only 12 percent of their value in the year to April, compared with the 30 percent shed by equity markets.
Mark Lindhiem, the head of manager research at Investment Solutions, said at the weekend that pension funds escaped the full force of the economic crisis because they had more diversified investments.
They were invested in local property, which rose 17.5 percent in the 12 months to April, bonds, which increased 15 percent, and cash, which surged 11.7 percent.
"South Africa has fared much better than developed countries such as the US," said Lindhiem. "Because most South African pension funds are not exposed only to equities, they have lost less money."
He could not give an accurate rand value of pension fund losses, but said the JSE was down by 30 percent for the year to April, representing a loss of more than R1 trillion.
De Wet van der Spuy, an investment consultant at Old Mutual Corporate, said pension fund members that were badly hit were those on defined contribution options.
He said US pension funds were badly hit by the global financial meltdown, but the members were protected by the fact that most of them were on defined benefit options.
"At least their members have not felt the pinch like ours in terms of having to carry the risk of their investments."
For many years there has been a trend towards defined contribution funds in South Africa, which are seen as transparent, and away from defined benefit funds, which employers see as a risk. Lindhiem said the trade-off was that members saw how volatile their investments could be.