Breakdown of investments by asset class
AP Pension’s wealth is invested in various assets based on its investment strategy. Investments are adjusted on an ongoing basis in line with developments in the financial markets and expectations for future economic developments.
Allocation of assets
|
|
2023 |
2022 |
2021 |
2020 |
|
Government and mortgage bonds |
33.14% |
37.72% |
43.69% |
46.91% |
|
Investment grade bonds |
3.12% |
2.86% |
2.12% |
4.06% |
|
High yield bonds |
5.13% |
3.90% |
3.04% |
4.60% |
|
Emerging market government bonds |
4.40% |
5.68% |
4.59% |
4.64% |
|
Global shares (developed markets) |
33.26% |
30.77% |
31.39% |
24.91% |
|
Emerging market shares |
2.27% |
1.84% |
2.35% |
2.76% |
|
Private equity |
2.95% |
2.91% |
2.60% |
3.54% |
|
Infrastructure |
3.10% |
3.28% |
1.85% |
0.63% |
|
Real estate |
12.62% |
11.05% |
8.37% |
7.96% |
|
Hedge funds |
0% |
0% |
0% |
0% |
Shares
When AP Pension selects external managers to invest in e.g. shares, the managers are selected through a thorough selection process. Investments are made in shares from all over the world because a global spread of shares provides greater risk diversification and because AP Pension believes that this will result in a higher return in the long term.
AP Pension may invest in the following types of listed shares:
- European shares
- Danish shares
- North American shares
- Japanese shares
- Far Eastern shares
- Listed shares in emerging markets (markets with developing economies) and frontier markets (markets that are still small enough to be defined as developing economies).
Listed shares are managed both internally and externally.
The risk of price fluctuations is greater for shares than for bonds, but in the long term shares are expected to provide a higher return. AP Pension invests as much in shares as is reasonable in relation to the customers’ risk profile.
A comprehensive list of AP Pension’s investments in listed shares is available here
Bonds
AP Pension’s bond portfolio mainly consists of:
- Danish government and mortgage bonds
- European government bonds
- High yield bonds
- Emerging market government bonds
The portfolio may also consist of credit bonds (including corporate bonds) as well as high yield bonds and emerging market bonds (emerging markets mean markets with developing economies).
Bonds are a relatively safe type of investment and a large part of AP Pension’s investment portfolio is therefore made up of bonds.
Real estate
AP Pension’s real estate portfolio is very broad, with investments in both Danish and foreign real estate, although most are Danish properties. In Denmark, these are direct investments, while abroad these are investments in real estate funds, where AP Pension is part of a pool with other investors, generally other Danish pension companies. These are all types of real estate, from office and residential properties to logistics and retail properties.
Real estate is a relatively safe investment type. Therefore, real estate generally constitutes a significant percentage of AP Pension’s capital assets. However, AP Pension attaches importance to having an active real estate portfolio so that investments constantly follow market developments. This means that the proportion of real estate investments can be high in certain periods and low in others, depending on the opportunities that arise.
Other capital assets
In addition to shares, bonds and real estate, AP Pension also invests in infrastructure, among other things.