Iceland’s second-largest pension fund, the Pension Fund of Commerce (Lífeyrissjóður verzlunarmanna, LV), reported that its allocation of international funding had elevated to 43% of whole belongings on the finish of final yr.
LV stated in its preliminary 2020 monetary outcomes announcement: “The fund’s portfolio is properly diversified by way of threat. Overseas securities represented 43% of whole belongings on the finish of the yr, up from 40% on the finish of 2019. ”
LV’s newest international asset allocation determine is considerably greater than the 34% reached final yr by Icelandic pension funds on common.
Icelandic pension funds have made efforts to extend their weighting in non-domestic investments in recent times, following the easing of capital controls after the monetary disaster within the North Atlantic nation in 2016.
At this level, the international allocations of funds amounted to about 20%.
LV investments returned 14.7% final yr, after gaining 18.7% in 2019, in line with its earnings launch.
The returns of the final two years reported by the pension fund are properly above double its long-term common earnings, at 6.2% over the past 5 years, 6.75% over 10 years and 4.5% over 20 years.
“LV’s operations had been profitable in the course of the yr and the efficiency of the portfolio was good regardless of demanding pandemic circumstances,” the pension fund stated.
In January, Icelandic pension fund Frjálsi stated the weakening of the nationwide foreign money unit had elevated the worth of its allocation to international shares, because the foreign money’s fall additionally boosted funding good points on international belongings by way of crowns.
The Industrial Pension Fund stated its whole belongings elevated by ISK 145 billion (€ 939 million) in 2020 to succeed in ISK 1.01 billion on the finish of final yr.