NETHERLANDS – PGGM, the second largest Dutch pension fund, made an 18.8% return on commodities in the third quarter of 2004 – but equities were down 0.7%.

“PGGM achieved an overall return of 1.7% in the third quarter of 2004,” the Zeist-based health care scheme said. “The highest return was 18.8% on commodities, which was largely attributable to the rise in oil prices.”

The commodities portfolio has returned 36.2% in the year so far. Fixed income returned 2.5% in the third quarter. The fund is now worth 57 billion euros.

“The overall return of –0.7% on equities had a negative effect on the overall return for the quarter.” The fund has made a return for the year-to-date of 5.9%.

“Sentiment in the financial markets is currently uncertain,” said chief investment officer Roderick Munsters. “The net effect of rising oil prices, higher short-term interest rates in the USA and uncertainty about the sustainability of the economic recovery have all contributed to the horizontal trends we’re now seeing in the markets.”

“PGGM’s good spread of investments over the various asset categories has ensured a relatively stable return for 2004. We expect a further modest improvement in the portfolio return in the fourth quarter of the year, which should ring the overall return closer to the forecast long-term return of around eight percent.”


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