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Impact Investing

IPE special report May 2018

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LD returns 8.7% in 2014 on Danish equities, US investment growth

Denmark’s LD pension fund reported an investment return of 8.7% for 2014, and said strong returns on Danish shares and US investments in general had pushed profits higher.

The return compares with 8.8% for the previous year.

LD director Dorrit Vanglo said: “This is a really good result that we are very pleased with — seen both in the light of modest growth in the economy and the very low level of inflation.”

While rising prices on the Danish equities market helped drive overall investment returns higher, the fall in interest rates over the year had increased profits on both general bonds and corporate bonds, LD said.

“We have had positive returns in all funds, and when we look outside the country’s borders, it was particularly investments in the US that gave good results,” said Vanglo.

She predicted that it would be the US that pulled the world economy forward in 2015 as well.

At the same time, the stronger dollar meant goods produced in Europe would be relatively cheaper, thus making European business more competitive, she said.

Assets under management rose by DKK1.2bn (€161m) in 2014 to end the year at DKK54.6bn, after payments made to members of DKK2.5bn.

LD is a non-contributory pension scheme based on cost-of-living allowances granted to workers in 1980, and as such it receives no new contribution inflows.

Vanglo said LD’s costs were being kept to an absolute minimum.

“There are just 15 staff at LD and we have tight control over our suppliers, under which costs fall when overall assets and the number of members fall,” she said.

For more on LD’s investment startegy, see investment editor Martin Steward’s interview with Dorrit Vanglo

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