The investment strategy defines the basic and long-term orientation of investments in the various asset classes (equities, bonds, real estate etc.). The latter provide the framework for achieving the targeted return required to maintain the funding ratio – in a risk-conscious manner. The investment strategy is influenced by the economic situation, available capital and risk tolerance of the Pension Fund.
As part of the periodic detailed review, the investment strategy for 2016 to 2018 was revised with effect from the start of 2019. The focus remained on increasing diversification and retaining the yield potential. This was achieved by adjusting the target allocations in the various existing investment segments. The domestic market overweight was reduced in bonds, equities and real estate, while private market investments and investments in emerging economies were increased. This has resulted in an even more robust overall portfolio that can continue to withstand various market conditions.
The broadly diversified investment strategy introduced at the beginning of 2019 has been successful. It continues to enable appropriate tactical positioning in the expected investment environment. We will therefore continue to pursue the strategy unchanged in 2021. There will, however, be an in-depth review during the course of the year in order to enable the next optimisation for a longer-term investment horizon from 2022 onwards.
Version: January 2021