SWITZERLAND – Swiss occupational pension fund returns remained positive for the third year running in 2001 despite turbulent markets according to the latest performance survey by Watson Wyatt and ASIP, the Swiss pension fund association.
Though the median return on consolidated equity and fixed income assets for company pension funds actually fell 7.1% last year, compared with positive returns of 11.5% and 1.5% in 1999 and 2000 respectively, this still represented an outperformance of 0.5% against the Swiss Performance Index, the industry’s benchmark.
The survey also finds that the long-term investment strategy of Swiss funds remains constant, particularly with regard to equity investments, which continue to increase. Swiss funds decided not to make short-term equity sales to help sustain returns in last year’s volatile markets, the report says.
This finding is supported by the latest joint Robeco (Suisse), Bilanz and Prévoyance Professionnelle Suisse survey of Swiss occupational funds’ asset allocation strategies that also suggests that the funds favour equities. The Robeco survey finds that at the end of 2000, equities accounted for 38% of all Swiss company funds’ asset allocations, compared with 29% the previous year.
As with the Watson Watt survey, it finds that pension funds are opting more for overseas equities, as a large contingent of those polled say they intend to increase their equity weightings yet further, but mainly in international stocks and at a slower rate of growth.
The Watson Wyatt / ASIP survey sought the views of over 60 occupational pension funds in Switzerland with combined assets under management of SFr 80bn (€54.7bn), as opposed to the Robeco survey which looked at 164 funds representing SFr 201bn (€137.4bn).