Equities Were Sweet in Q110

Mercer said the U.S. equity asset class outperformed international equities for the quarter by 450 basis points. Global equities gained 3.2% for the quarter and outperformed international equities by 230 basis points.

Meanwhile, during the first quarter, value funds outperformed growth funds, as the median large-cap value fund posted a gain of 5.8% compared to a gain of 4.2% for the median large cap growth fund. The small-cap segment of the market trended in the same direction as large-cap stocks, as the median small-cap value fund outperformed the median small-cap growth fund by 200 basis points.

According to Mercer, the median large-cap fund underperformed the S&P 500 Index by 40 basis points for the first quarter. Small-cap funds outperformed their large-cap counterparts for the quarter, as the median small-cap fund gained 7.9% for the quarter versus a gain of 5% for the median large-cap fund.

Within the international equity asset class, the median manager outperformed the MSCI EAFE Index by 80 basis points during the quarter. The median emerging markets manager gained 2.7% for the quarter and slightly outperformed the MSCI Emerging Markets Free Index by 20 basis points.

The median core fixed-income fund outperformed the Barclays Capital Aggregate index for the first quarter by 40 basis points.

Mercer said the S&P 500 Index gained 5.4% during the quarter while the Barclays Capital Aggregate Bond Index posted a gain of 1.8%. Inflation protected securities posted a return of 0.6 % for the quarter.