Danish labour market pension fund Sampension is to put more money into alternatives including real estate over the next five years, boosting its allocation to between 20% and 25% of total assets, and is hiring four extra people on its alternatives team.
Reporting interim results, chief executive Hasse Jørgensen said: “We will have the skills to deliver high stable returns for customers over the coming years.”
To support the increased allocation, the pension fund has been developing an alternative investments team, along with other other parts of the organisation.
Jørgensen told IPE that Sampension was adding four new staff to its alternatives team, and two of these were already in place.
Over the next five years, the pension fund will invest DKK15bn (€2bn) in alternatives, he said, which will bring the allocation — including real estate — to between 20% and 25% from just under 20% now.
Some of this DKK15bn will come from new money, and some will be re-investment from other areas, such as private equity investment funds that had matured, he said.
“We are giving alternatives a higher priority,” Jørgensen said.
In its first-half results, Sampension reported a loss of 0.7% for traditional with-profits pensions before pensions tax, after a 10.9% profit in the same period last year.
Even though the investment portfolio had generated a 2.2% return in the period, the hedging portfolio ended in June with a 3.8% loss as a result of higher long-term bond yields.