DENMARK- ATP, the DKK212.7bn (e28.7bn) Danish labour market supplementary pension scheme, has reduced its portfolio allocation in equities from 45% to 35% following negative second quarter results. During this period the listed equity portfolio lost 12.3%.
“Due to increasing equity volatility, it was felt appropriate to reduce holdings in equities and transfer the funds into more suitable asset classes,” explains Bjarne Graven Larsen, chief investment officer at ATP.
Holdings in US stocks have been dramatically reduced, as have European equity allocations. The reduction in US stock has resulted in a decreased mandate for its external manager.
Investments in Japanese and Danish equities have remained unchanged, although the fund has increased its holdings in global emerging market equities.
Overall losses for the fund in the second quarter were 4.6%, bolstered by a 3.1% gain for international bonds. Despite gains, however, the bond portfolio underperformed its benchmark due to its relatively low interest rate sensitivity. ATP has now increased its bond holdings from 49.5% to 59.5%.
The remaining 5.5% remains invested in other assets, which yielded a return of 0.8% during the second quarter. Real estate produced a positive return of 1.4%.