By Sophie Baker
A solid recovery in the Second Swedish National Pension Fund (AP2) has been secured thanks to continuing high share of equities, says the Fund.
The first half of 2009 recorded major market fluctuations compared to autumn 2008, despite equities, fixed income and foreign exchange markets proving somewhat calmer. The Fund's positive result, of a return of 6.4 per cent on its total portfolio, excluding costs, has been largely attributed to the continuing high share of equities in AP2's portfolio, particularly in terms of the Swedish market.
The Fund's capital assets were recorded at SEK 182.5bn as at June 30 2009, and the net profit for H1 2009 was SEK 10.9bn.
Strategically, the Fund's allocation to corporate credits has been increased, and during the first half of 2009, AP2 participated in a number of new share issues on the Swedish equities market, contributing SEK 700million to Swedish companies.
Eva Halvarsson, CEO of the Second AP Fund, said: "Our strategy of maintaining the portfolio's high share of equities as been a key factor in its recovery. Our fundamental approach therefore remains unchanged. We believe a large share of equities is essential if we are to achieve the goal prescribed for us within the Swedish national pension system."
A Corporate Governance Report is expected for publication in September.