first_imgDenmark’s giant statutory pension fund ATP posted its highest half-year return in five years in the first six months of 2016, gaining 14.6%.The return – recorded by ATP’s investment portfolio – was aided by the fund’s decision to increase its exposure to interest rate risk, according to CEO Christian Hyldahl.The pension fund’s overall assets grew to DKK748bn (€100bn) by the end of June from DKK759bn at the end of December, according to its interim report. Within that, its investment portfolio – which consists of its bonus reserves – rose to DKK112bn, from DKK100bn.European financial markets saw equity gains and moderate increases in interest rates in the first half of this year, ATP said, while interest rates in the US had ended the period around their starting level. Although the US and European economies were showing positive momentum, interest rates remained extremely low, it said.Hyldahl said: “While this is positive from a growth perspective, investors will be faced with the challenge of continuing to generate the same high returns in the quarters and years ahead.“However, we still have leeway to take return-generating risks, but we will do so based on an extremely disciplined approach to both portfolio construction and risk management.”Hyldahl told IPE: “In the first half year we have been able to increase the overall risk levels and have done that by increasing the interest-rate risk factor.”The investment portfolio’s exposure to interest-rate risk rose to 35% by the end of June, from 25% at the end of December. Its allocation to the equity risk factor contracted to 44% from 50%.The allocation to the inflation risk factor grew to 12% from 9%.ATP said the risk budget for its investment portfolio had grown in the first half as a result of the increase in its resources.While it had simultaneously increased risk in the period, the risk usage as a proportion of the budget had in fact decreased, data showed.“We are only utilising about 60% of our risk budget now,” Hyldahl said. He added that it was better to retain some leeway in order to avoid potentially having to decrease risk in a falling market.ATP said the first half return on its investment portfolio had been driven by positive returns achieved across the portfolio, with the largest being DKK4.1bn from listed Danish equities.Private equity, listed international equities and credit investments had also contributed high positive returns, it said.“This is the strongest six-month return in five years – something for our members to celebrate,” Hyldahl said.The majority of ATP’s assets belong to its hedging portfolio which consists of bond-based instruments designed to protect the pension guarantees it makes, and this allows it to effectively gear the investment in its smaller investment portfolio.This makes it hard to compare ATP’s investment portfolio returns with those of other pension funds.last_img read more

first_img Bookies Corner: Trump Presidency sinks as US 2020 enters its 100 day countdown July 29, 2020 Paddy Power Betfair (PPB) has awarded its retail maintenance contract to facility management specialist ISS for its portfolio of +600 Paddy Power betting shops across the UK and Ireland.The contract will see ISS act as the bookmaker’s technical services lead, as well as managing betting shop portfolio maintenance. ISS provisions for Paddy Power estates will include cleaning, support services, property upkeep services, catering and security monitoring.The partnership with ISS will focus on using technology to innovate and ensure smart delivery across the vast geographic spread of the retail unit portfolio via the 24/7 ISS Service Centre. The ISS Mobile Engineer network of over 750 Mobile engineers will deliver an efficient and customer-centric service delivery to Paddy Power.Kevin Macpherson, Head of Property & Development UK & ROI for Paddy Power said, “The Paddy Power partnership with ISS will ensure a consistent, efficient and positive impact directly to our retail stores, supporting our vision to provide the highest levels of service for our customers. We look forward to working closely with ISS to develop the relationship and service further.”Kath Fontana, Managing Director, ISS Technical Services said “After a rigorous tender process, ISS is delighted to be selected by Paddy Power to deliver an innovative mobile technical solution. We are aligned in our values and customer service ethos which are great foundations for a successful partnership and we are looking forward to supporting Paddy Power in constantly improving their customer experience.” Flutter moves to refine merger benefits against 2020 trading realities August 27, 2020 Share Submit Related Articles Paddy Power raises awareness of Missing People with Motherwell ‘silhouette’ stand August 7, 2020 Share StumbleUponlast_img read more