Figures from investment consultants Mercer show that the value of Irish pension funds dropped by around €3 billion in July as a result of recent falls in stock markets.
Mercer estimates that the average fund dropped by around 3% in value in the month. The worst performing sector was the Irish stock market, with the down 8%.
The average Irish pension fund has around 18% invested in Irish shares, so the ISEQ's performance has a big impact. But the Irish market accounts for less than 1% of the FTSE World Index.
Mercer's Tom Geraghty said what he called the 'significant overweighting' in Irish shares deserved a serious rethink, though in the past investors had been well compensated as the ISEQ had outperformed other markets.
Mr Geraghty said pension funds were not diversified enough and ran the risk of a shock to the overall Irish market, or one particular sector.
