SWEDEN - Första AP-fonden (AP1) returned SEK 3bn ($463bn) after expenses in the first half of 2011, representing a return of 1.4%.
The fund had net assets under management of SEK 221.6bn as of 30 June 2011, with exposure to equities at 53.6%, exposure to fixed income investments at 38.2% and exposure to alternative investments at 8.3%.
The fund said although the economy continued to expand in the first half of 2011, a number of structural problems had an inhibiting effect on global growth. As a result of the changed risk scenario, the fund successively reduced its equity exposure during the spring.
It sold SEK 11bn of equities have been sold and reinvested mainly in fixed income instruments with lower risk, it added. The fund has also increased its real estate exposure, partly through two new management mandates for global real estate equities and partly through the formation of a new real estate company for European commercial properties.
"We have continued our efforts to create a more robust portfolio and are achieving this by investing in well chosen assets and through our strong focus on allocation," said Första AP-fonden's managing director Johan Magnusson said.
"After the mid-year shift the markets have been characterised by widespread financial turmoil, which has resulted in less favourable development for Första AP-fonden's investments.
"However, the resulting losses have been limited by falling interest rates and the fund's active steps to reduce equity exposure in the portfolio. Första AP-fonden has not changed its long-term investment orientation."
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