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Thursday 27 June 2019

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Worst year for equities since the financial crisis for Industriens Pension

Written by Sunniva Kolostyak
10/01/2019

Danish pension scheme Industriens Pension saw its worst year for equity returns since the financial crisis in 2018, it announced.

The uncertain stock market which has caused low returns for investors everywhere, caused by concerns about a new recession, Trump’s trading tariffs and trade conflict, as well as Italy’s economic stability and Brexit, the fund explained.

Having a well-diversified equity portfolio has made the fund less vulnerable than several others, the scheme’s CIO Karsten Kjellerup Kjeldsen said.

“The equity markets fell sharply last year in Denmark, the rest of Europe, the US and most emerging markets. It was felt by everyone, including Industriens Pension, where we have been accustomed to very high returns for many years,” Kjeldsen said.

“Even if our big investments in other types of assets and listed equities have helped us, we could not avoid being hit when the share prices fell as notably as in 2018.”

Kjeldsen pointed out that the most important thing for members is the long-term result, where Industriens Pension has returned an average of 9 per cent on an annual basis. Investors should however prepare for lower returns than what has been usual in the past years as the market will not grow at the same pace it did for several years leading up to 2017.

“It is of course really annoying for all investors to look at the returns in 2018 in isolation. As pension savers you luckily live off of solid long-term returns, and Industriens Pension is well equipped.”



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