Denmark’s PFA has generated an 8.3 per cent return for a typical customer with a medium risk profile and 15 years to retirement in the first half of 2026.

PFA said this return continues the good results from previous years and means that the three-year return in the medium risk profile is now 40.3 per cent, while the 10-year return has reached 107 per cent. 

In addition to this, the pension provider noted that both the half-year and three-year returns are among the best in the commercial market.

PFA chief investment officer, Kasper Lorenzen, said that, like last year, the first few months of the year have seen “significant” volatility in global financial markets, driven by the conflict in the Middle East, which has alternated between escalation and prospects for peace.

“At times, this has sent oil prices up sharply and reduced economic visibility. Nevertheless, both the global economy and companies have proven robust enough to withstand the shocks that have come, and this has had a positive impact on the stock markets,” he said.

He added that despite the first half of the year featuring large fluctuations in equity markets, primarily driven by the conflict in the Middle East, like last year, both the economy and companies have shown great resilience and strength, which has helped lift returns.

Indeed, Lorenzen pointed out that for a typical PFA customer with a medium risk profile, returns fell to -3.2 per cent at one point, but the half-year ended with a positive return of 8.3 per cent, roughly on a par with the return one would normally achieve in a year.

He said that these results are yet another reminder that it “pays to keep a cool head” and is pleased that, for the fourth year running, PFA’s customers look set to enjoy a year of positive investment returns.

The good returns achieved in the first six months of 2026 apply to both PFA's broad-based product, PFA Plus, and the climate-focused product, PFA Climate Plus.

The half-year return for a typical medium-risk customer with the PFA Climate Plus product is 11.3 per cent, which is at the top both overall and among comparable products in the market. PFA attributed the strong result mainly to a robust equity allocation.

The pension provider also partly credited its overall good results to its new investment profiles with a greater focus on equities, which PFA launched last year. PFA said that this proved beneficial last year, and has continued to do so this year, with the US and the US technology sector once again accounting for a large proportion of the returns.

"It has again been an advantage this year to be solidly invested in the US and in particular in the US technology sector, which has continued to draw a lot of the returns,” Lorenzen explained. “That said, it is still something we keep a close eye on when so much market value accumulates in a relatively small part of the market.”

He added that the 10 largest technology companies currently account for more than 40 per cent of the US S&P 500 share index.

PFA acknowledged that while equities have delivered a strong half-year, bonds have yielded modest positive returns, weighed down by the continued high interest rates.

The provider said that interest rates, particularly in the US, have been a recurring theme this year, as they increase borrowing costs and put pressure on the growing national debt. Meanwhile, high inflation and low unemployment have continued to make interest rate cuts difficult.

On the other hand, PFA noted that the de-escalation in the Middle East and the reopening of the Strait of Hormuz, which has sent oil prices down significantly, may, in the long term, provide greater scope for monetary policy.

In any case, PFA suggested that an “exciting” second half of the year awaits both the US economy and politics.

Looking ahead, Lorenzen said: “After six months with a strong foreign policy focus, the focus will probably turn more inwards in the US in the run-up to the election in November.

“Inflation and the cost of living will continue to be important themes, but unemployment is still low, and falling energy prices, together with lower inflation, may give US households a little more breathing space in their personal finances. At the same time, we must expect that the government will do what it can to keep domestic economic activity going.”

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