Emerging markets pooled funds outperformed those invested in other market segments during the second quarter of 2005, according to institutional fund data collected by Morningstar Canada.

The median fund in the nine-fund emerging markets equity category returned 6% during the three months ended June 30.

“Continued strong growth from China helped drive exports from resource-rich developing countries, lifting emerging markets funds to excellent second-quarter performance,” said Morningstar Canada analyst Mark Chow, in a release.

Among the more popular asset classes, pension fund managers who focused on Canadian bonds fared the best during the second quarter. The median Canadian bond fund gained 4.3% during the period.

“Canada’s developed and relatively strong economy has generated interest from foreign investors,” Chow said.

The next best performing category, with a median 3.6% gain, was Canadian equity (pure), which includes funds with 95% Canadian content. That equalled the performance of the benchmark S&P/TSX composite index, which resurfaced above the 10,000-point mark for the first time since 2000, but lagged the large-cap S&P/TSX 60 index’s 4.5% rise during the three-month period.

The median balanced fund rose 3.2% during the quarter, followed by 3.1% for the median fund in the Canadian equity category, which allows up to 30% of foreign content.

The five-fund real estate category had a good month as the median fund rose 3.3%. Funds with significant real-estate stock content were boosted by a 12.8% gain by the S&P/TSX capped real estate index and a 9.3% rise in the S&P/TSX capped REIT index.

The second quarter’s top performing fund overall was Fidelity Latin America MF, up 11.8%, followed by SEI Long Duration Bond, up 9.8%.

The worst performing category during the second quarter was international equity, in which the median fund gained 0.6%, just behind the median returns for Canadian money market at 0.65% and Canadian small cap equity at 0.7%.

Among pooled-fund management firms, Burgundy Asset Management had the most funds with a five-star Morningstar Rating at the end of the second quarter. Nine of its 10 funds rated by Morningstar earned the top rating at June 30, unchanged from March 31.