Denmark’s P+ generates DKK 15bn return since March

Denmark’s P+ has made a return of DKK 15bn since March and recorded its first positive return for the year at the end of August.

Publishing its results for the third quarter, the pension provider noted that the markets have recovered strongly since the crisis in the spring. It believes that markets have become more familiar with the uncertainty created by the pandemic.

P+ investment director, Kåre Hahn Michelsen, said: “After the historic price declines as a result of the Covid-19 pandemic, we came out of the first quarter with a return of -12.2 per cent.

“Due to, among other things, the political aid packages and the central banks' coordinated efforts, we were already able to see a sharp upward curve in the market as early as April, which meant that we could close the second quarter with a deficit of 3.5 per cent. Since then, the trend has continued, and at the end of August, our investment portfolio delivered the first positive return of the year.”

The investment portfolio’s return for the year-to-date up to the end of August was 0.4 per cent. In isolation it noted is not impressive but amongst the backdrop of the pandemic, it is the result of a “successful investment strategy and the fact that the markets have recovered very strongly after the spring crisis”.

“When the markets dived at the end of March, we kept a cool head. We made the best use of the market opportunities that arose involuntarily, and we remained in the market until the increases came. As a result, since the end of March, we have recovered the majority of the spring's losses and created over DKK 15bn in returns for our members,” Hahn Michelsen added.

“Developments show that even large fluctuations in the markets have relatively small consequences for one's pension savings in the longer term. Despite Covid-19, we have since 1 January 2019 delivered a total return on the right side of 10 per cent to our members, and that underlines the importance of thinking long-term - not least when standing in the middle of the hurricane's eye. ”

Despite the ongoing pandemic, which is seeing increased cases again in Europe, P+ believes that it will now end the year with a positive return.
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