Danish pension fund manager LD Pensions has launched a new tender for a global developed markets high conviction equities mandate.

The expected size of the mandate is DKK3bn (€400m), LD Pension said, adding that this was an indicative amount only because it could not determine the volume in advance.

“It is important that the product have available capacity of minimum €500m at the time of signing the agreement,” the firm said.

LD Pensions, which runs the fledgling Lønmodtagernes Feriemidler (Danish holiday allowances fund) and the mature Lønmodtagernes Dyrtidsfond (legacy cost-of-living allowances fund), is in the process of putting out a range of tenders as it builds up investment capacity for expected inflows to the new holiday allowances fund.

But the firm is not yet able to estimate how large the investable size of that fund will be.

In its notice on the EU’s TED tenders platform, LD Pensions said the investment approach for this latest equities mandate had to be long term, fundamental stock picking based on a deep understanding of companies in the portfolio and the investment universe.

“The intention is to generate alpha, adjusted for academically-tested factors such as value, size, momentum, low-volatility and quality,” it said, adding that the mandate was long only.

The portfolio is to be concentrated, consisting of equities of all sizes, relatively beta-neutral, with no extreme biases to momentum, deep value, small cap, high growth or low volatility, for example, according to LD Pensions.

Environmental, social and governance (ESG) factors should be fully integrated in the investment process, it said, with LD Pensions’ exclusion list incorporated in the investment restrictions.

The Copenhagen-based pensions manager said it envisaged shortlisting six managers in the tender process.

The contract is for four years, with up to three renewals of 12 months each possible.

The deadline for receipt of tenders or requests to participate is 14 April 2020, at a minute to midnight.

 

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