Dutch schemes give lowest returns for six years
NETHERLANDS – Dutch pension funds produced their lowest figures for six years in 2000, with the average return coming out at 2.6%, according to performance measurement group WM....
And for the first time in a decade the trend of climbing equity exposures in the Netherlands has been broken, with allocation of shares creeping back to 41% from 47% in 1999.
Fixed-income allocations, meanwhile, increased considerably on the year to 47% from 43% the previous year, thus forming again the main investment category for Dutch funds.
The WM Universe of Dutch pension funds is based on the investment portfolios of 201 schemes amounting to e227bn.
The value excludes the portfolios of Dutch superfunds ABP and PGGM, which are not counted due to their size.
In 1999 Dutch funds returned an average of 16.3% on the back of sterling equity performance.
Robert Rijlaarsdam, general manager of the WM Company in Amsterdam, comments that the damp 2000 was mainly due to the general slide in the value of equities worldwide – but especially in the Far East and emerging markets.
He notes that shares in the ICT sector – 1999’s high flyers – were the worst performing assets of 2000.
These losses, he says, were mitigated somewhat by more solid returns on fixed income (7.8%) and property, by far the year’s highest performer at 18.9%.
However, over the longer term bond and property returns still lag that of shares.
Over three and five years, equities have produced 15.6% and 21.6% respectively.
Bond returns over the same time frame come out at 5.9% and 7%, while property has recorded 14.8% and 14.3%.