DENMARK - PensionDanmark posted a benchmark-beating 3.6% return during the third quarter 2006, which saw the fund grow DKK1.4bn year-to-date to a total of DKK58.9bn (€7.9bn).
In an environment of declining bond prices and a rising equity market, PensionDanmark succeeded in beating the assigned benchmark by 0.3%.
The performance was attributed to an interest rate sensitivity that was lower than the benchmark. The fund's equity portfolio, that registered a 0.2% excess return also made a positive contribution.
All the asset classes, bar high yield bonds, performed well and beat the benchmark over the first three quarters of 2006.
The high yield bond allocation was the only one that posted a 4.3% return against a benchmark of 4.7%.
The fund's 3.3% allocation to private equity proved to be the best performing asset class over the period, returning 10.8% and comfortably beating the benchmark by 1.5%.
PensionDanmark's real estate portfolio (5.3%) performed well over 2006, while its hedge fund allocation provided a 4.2% return compared to the benchmark of 3.8%.
PensionDanmark CEO Torben Möger Pedersen commented: “The positive growth in members and premiums has continued in the third quarter of 2006.
With a result of DKK1.4bn for the first three quarters, and with the strong consolidation, an expected deposit rate at 6.0% after taxes will be maintained."
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