LD Pensions (LD Fonde) generated 2024 returns of 8.1% and 11% for the two pension funds it runs, and said it acted last year to broaden diversification and also to boost risk exposure for the youngest fund.
Lars Mayland Nielsen, chief executive officer of LD Pensions, said: “Our portfolios are already broadly composed to spread risk and exploit the potential across markets and asset classes, and in 2024 we took further steps to diversify our investments, so we’re even stronger when it comes to the opportunities and challenges of the future.”
LD Pensions managed DKK46.7bn (€6.2bn) of assets at the end of 2024 – DKK24.3bn of that for the Cost-of-Living Allowance Fund (Lønmodtagernes Dyrtidsmidler), which the organisation has managed since 1980, and DKK22.4bn for the Holiday Allowance Fund (Lønmodtagernes Feriemidler), which was established in connection with the 2020 Holidays Act.
Scheme members in the Cost-of-Living Allowance Fund received an 8.1% return after costs for 2024, while those in the Holiday Allowance Fund were credited with an 11.0% gain after costs and tax, it announced on Thursday.
Total assets under management increased in 2024 by DKK300m for LD Pensions, despite the fact that neither pension fund receives new contributions, and that members of both have been making withdrawals.
The institutional investor said: “In 2024, LD Pensions expanded the investment universe with listed alternatives, and at the same time began new initiatives within government bonds from developing countries.
“At the same time, we increased the risk level in Lønmodtagernes Feriemidler,” it said.
In January last year, LD Pensions awarded a DKK2bn listed alternatives mandate to BankInvest, saying that adding the asset class would improve the spread of risk for LD’s equity investments.
The biggest contributor to the 2024 return was global stock markets, LD Pensions said, adding that progress had mainly been driven by the biggest US technology companies. Danish equities, which make up a smaller part of the equity portfolio, ended the year with a small loss, the investor said.
Bond markets continued to deliver solid returns in 2024, as was the case the year before, after significant losses in 2022, LD said.
“The robust economic development and increasing risk appetite also contributed to good returns on credit investments,” the Frederiksberg-based pensions manager said.
This had been particularly important for Cost of Living Allowances fund members, it said, with bond and credit investments accounting for around three quarters of the scheme’s main LD Discretionary (LD Vælger) pool.
Read the digital edition of IPE’s latest magazine
No comments yet