China's social security fund has reached an annualized return rate of 18.62 percent in the stock market from June 2003 to the end of last year, Dai Xianglong, chairman of the National Council for Social Security Fund announced on Thursday in Beijing.

Share earnings came to 132.6 billion yuan, ($20.9 billion) during that period, accounting for 46 percent of the social security fund's total investment income, Dai said.

"If we purchase the stocks at reasonable prices and insist on long-term investments, we can expect a higher return than that from fixed income instruments, even though there are more fluctuations," Dai said.

The average proportion of the fund's investment in the stock market was 19.2 percent during the seven-and-a-half year, according to the council.