Danish pension fund Velliv is to slow down the pace of its investment into equity markets because of uncertainty around economic growth that it predicts is looming on the horizon next year.

The fund, which changed its name last year from Nordea Liv & Pension Denmark, said market returns in the first few months of 2019 had more than made up for the investment losses it reported for 2018.

This recovery was due in part to the pension fund’s strategy of investing customers’ savings in a higher amount of equities this year, Velliv said, after turbulent financial markets in the fourth quarter of 2018.

Anders Stensbøl Christiansen, CIO of Velliv, said: “In light of the significant increases in the stock markets in just two months, we are now slightly slowing down the share portfolio – also because in 2020 we see some uncertainty about global economic growth.”

The MSCI World index fell by 3.6% in euro terms over the course of 2018, but since the start of 2019 to 1 April the index rose by 16.1%.

Velliv reported that, although DKK100 of customer savings at the beginning of 2018 had fallen to roughly DKK95-96 by the end of last year, it had risen to DKK103 at the end of March 2019.

Christiansen said: “The development clearly shows that one must be careful not to think too short-term. Patience pays off.”

He added: “There is a prospect of a good ending to the trade war between China and the United States. At the same time, the Chinese are doing everything to stimulate their finances. Finally, the US central bank has clearly signalled that it is no longer so busy raising its interest rates.”

To illustrate the strength of long-term returns, Velliv reported that its VækstPension Aktiv product, with medium risk and 15 years to retirement, produced an accumulated return of 100% over the past 10 years, despite the loss in Q4 2018.

Velliv had DKK219bn (€29bn) in total assets at the end of last year.