NETHERLANDS - SPT, the €1.3bn pension fund for dentists and dental specialists, has terminated its mandate with equity manager WP Stewart due to disappointing returns.

In its annual report, the fund also reported negative equity returns of -6.3%, or 8 percentage points short of the benchmark.

"With the exception of growth manager Walter Scott, all equity managers have shown poor overall performance," SPT said. It said the performance of Legg Mason and WP Stewart in particular was disappointing.

In order to reduce costs, SPT's board has started a survey into the relationship between external managers' fees and their performance.

While SPT's return on its investments was -1.6%, it was still able to report a positive overall return of 0.4% mainly due to a partial hedge of equity, interest and currency risks. The currency hedge contributed 3.38% to overall returns, but this was partly offset, as its US dollar investments lost value because of the currency's continuing decline.

SPT's fixed income portfolio, which includes derivatives, returned 2.3%, according to the fund. Last year, the scheme terminated its mandate with the fixed income specialist PIMCO, investing the instead with Barclays Global Investors through a passively managed mandate.

The dentists' scheme has decided to further adjust its strategic assed mix to 45% equities and 55% fixed income. In addition, the fund has taken a tactical position in convertible bonds. Its convertibles portfolio - managed by Calamos - returned 3.4%, considerably above the benchmark of -3.1%.