P+ returns 8.7% in Q2 2021; reaches milestone DKK 150bn AUM

The Danish pension fund for academics, P +, made a return of 8.7 per cent on its P+ Balance portfolio in the second quarter of 2021, it has revealed.

At the end of July its assets surpassed the DKK 150bn mark for the first time, which was helped by the further strengthening of the financial markets.

P+ investment director, Kåre Hahn Michelsen, said: “The trend from the spring has continued, which means that we are still bringing home very good returns, especially on equities and real assets, which since the turn of the year have contributed 14 per cent and 6.9 per cent, respectively.”

He said that the increasing price of shares and their risk level has been the subject of discussion in the industry over the spring. However, P+ decided to stick with its risky shares, which he said has “really paid off”.

Commenting on reaching the milestone DKK 150bn of assets under management, Hahn Michelsen explained that reaching such a figure was an expected benefit of the merging of JØP and DIP, which joined together to form P+.

“As our wealth grows, we gain access to more attractive investment opportunities, greater influence as an investor and the opportunity to reduce costs – all for the benefit of our members.

“Our increasing wealth will thus be a prerequisite for attractive returns in the coming years, as the wealth ensures that we can, for example, raise the shareholding and risk level in the portfolio and at the same time maintain a broad and diversified portfolio. So the greater the wealth, the better the conditions for us to deliver the best possible return to our members,” he said.

On the general outlook for the global economy, P+ remains optimistic for the remaining half of 2021. "The pandemic is returning in the western economies and seems manageable despite new variants, vaccine scepticism and periodic problems with the roll-out of the vaccines. At the same time, the economies of society are recovering, and stock markets are responding sensibly to the bumps that are coming.

“The high inflation figures in the USA are seen by some as a point of concern, but as inflation has risen from a very low level, the current figures in our view are to be expected,” Hahn Michelsen said.

"The central banks continue to have full control over the situation, and as long as the economies avoid overheating, it is our expectation that they will continue the relaxed monetary policy.”

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