ITALY - The €258m solidarity fund, managed by PensPlan for the semi-autonomous Trentino Alto Adige region in northern Italy, returned -4.39% for 2008.

At the presentation of its annual report, the pension company PensPlan noted it had already begun to reduce the equity quota in the fund in 2007, though this was not enough to limit the damage caused by last year’s market turbulence.

At present, the firm has over 53% of its asset held in cash, while just 8% is in equities, 31% is in bonds and 8% is in alternatives.

The fund, which was created by the region to look after pension reserves, is argued to have at least outperformed its benchmark by 13.83 percentage point.

PensPlan noted the project of supplementary pensions for the region was still sufficiently funded, despite the losses sustained in 2008.

Within its annual report, the company also revealed details on the performance of the various supplementary pension funds it manages. (See earlier IPEstory: Half of PensPlan’s lines make gains

The company’s largest fund, Laborfonds, beat the benchmark in almost all its investment lines apart from the ethical investment line which underperformed by 0.71 percentage points and returned -3.4%, while the guaranteed investment line delivered a postiive return of 1.56% compared to a benchmark return of 2.37%.

PensPlan also said it will rethink its asset allocation strategy as “it becomes more and more obvious that high-rank experts haveonly  a limited influence on the return of a portfolio”.

“The only uncontested strategy is maximum diversification both between and within the various asset classes,” it argued.