LHV Pensionifond L
Active Management
10%
-10%
10%
10 year net yield
3
1
7
Risk level
30.75%
0%
100%
Invests into Estonia
91960
Fund investors

Suitable if

  • you have more than 10 years left until retirement,
  • you have average risk tolerance,
  • your aim is the long-term growth of your pension savings.
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Strategy

The assets of the Fund are invested in various asset classes in both local and foreign markets. The Fund's assets may be invested extensively in unquoted instruments, which are primarily used for investing in securities issued by companies domiciled in the home market. The long-term preferred asset class of the fund is private equity investments.

Performance
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Current year
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The Fund's return is expressed as the net yield after deduction of all fees.

Biggest investments

The data is presented as at 30.11.2021

Biggest investments
EfTEN Kinnisvarafond4.80%
German Treasury Bill 23/02/20223.88%
iShares Gold Producers UCITS ETF3.86%
German Treasury Bill 15/12/20213.83%
Riigi Kinnisvara 1.61% 09/06/273.82%
ZKB Gold ETF3.70%
NOAL2.43%
KJK Fund II Balkan Discovery A June 20142.17%
East Capital Baltic Property Fund III2.13%
Baltic Horizon Fund 4.25% 08/05/231.95%

Biggest investments in Estonia

Biggest investments in Estonia
EfTEN Kinnisvarafond4.80%
Riigi Kinnisvara 1.61% 09/06/273.82%
East Capital Baltic Property Fund III2.13%

Asset Classes

The data is presented as at 30.11.2021.

Information about the fund

Information about the fund
Volume of the fund (as of 30.11.2021)819,746,287.43 €
Management companyAS LHV Varahaldus
Equity in the fund2 000 000 units
Rate of the depository’s charge0,0576% (paid by LHV)
DepositoryAS SEB Pank

Entry fee: 0%

Exit fee: 0%

Management fee: 0,576%

Success fee: 20% per annum on any increase in the fund's rate of return over the annual increase of Estonian social security pension contribution since the end date of previous calendar year.

Ongoing charges (inc management fee): 1.14%

The ongoing charges figure is an estimate based on the current management fee and the 2020 level of all other recognized costs. Ongoing charges may vary from year to year.

December 2021: We made the first international co-investment

Kristo Oidermaa and Romet Enok, Fund Managers

In December, world stock markets mostly rose. The MSCI World Index, the US S&P 500, the Japanese Nikkei Index and the European Euro Stoxx 50 rose 3.2%, 3.7%, 1.6% and 5.8% over the month in euros, respectively. The MSCI Emerging Markets Index performed relatively modestly, rising 0.9% in euros during the month. The Baltic markets also rose: the Tallinn, Riga and Vilnius stock markets rose 1.6%, 0.7% and 0.6%, respectively.

In December, all major equity positions continued to rise. The largest contributors were European energy and industrial sector equities, as well as precious metals equities, which returned to their beginning-of-year levels. During 2021, we held equity investments primarily in the commodity sector, bank shares and strong industrial companies in the Nordic countries, which performed strongly against a background of rapid economic growth and rising inflationary pressures. The only stocks that remained static were precious metals, for which there was no buying interest during the positive phase of the market cycle. Currently, our major individual stock positions are in commodity-related stocks, where we see the best investment opportunities against a background of uncomfortably strong inflationary pressures.

For the first time, we added an international co-investment to Fund L’s private equity investment portfolio in the form of UrgentMED. Founded in 2007, this chain of urgent care clinics operates primarily in Southern California, US. The company already has 35 clinics and a wide range of services: health checks and tests, more general medical examinations, and wound care procedures. The main advantages of UrgentMED are the speed and accessibility of services and a relatively favourable pricing policy. The leading investor in the co-investment is Quilvest Club Fund II, in which our pension fund L has invested since 2019. Quilvest Club Fund II is run by Quilvest, a private equity firm founded in France in 1888.

In the last month of the year, both Alexela and Citadele repaid their bonds to Fund L. The fund earned 5.5% per annum on the former, plus an early redemption premium, and 6.25% per annum on the latter. Both companies developed strongly in the meantime and are moving towards banks and the public market, respectively, for raising money.

As a new investment, we subscribed to Liven bonds to finance a housing development project on Kadaka tee, Tallinn. The collateral for the bonds is land. The money will be returned in 2026 at the latest, according to the project’s progress, and the annual interest rate is 8%. We also signed an agreement to finance Bigbank’s development plans in the form of bonds. The bonds, which meet the regulatory requirements for banks, bear an interest of 6.5% per annum, and Bigbank has the first opportunity to redeem its liabilities in five years.

Local projects continue to be clearly more attractive than the bond markets in Western Europe and the US. That’s why we focus on working with local companies.

November 2021: We made a new venture capital investment

Kristo Oidermaa and Romet Enok, Fund Managers

In November, world stock markets mostly declined. As the euro strengthened by a significant 1.9% against the US dollar, only a few stock exchanges showed a slight rise in euro terms. For example, the MSCI World Index and S&P 500, which tracks the US stock market, rose 0.6% and 1.2% in euros, respectively, during the month.

Measured in euros, the Japanese Nikkei index fell 0.9%, the European Euro Stoxx 50 index 4.3% and the MSCI Emerging Markets index 2.2%. The local stock exchanges varied during the month: while the Tallinn and Vilnius stock markets grew by 0.6% and 0.9%, respectively, the Riga stock market declined by 2.5%.

November ended with a negative result for its individual positions in listed equities, mainly due to the companies’ stock prices in the energy and banking sectors. Equity positions related to precious metals were on the plus side, and in the middle of the month, we reduced the equity risk of the fund.

Among the sales transactions concluded during the month, significantly reducing our equity positions in Swedbank and Banco Santander had the largest effect. In an environment of faster inflation, our funds hold their main investments in the stock markets’ precious metals, energy and commodities sectors more broadly.

We added Karma Ventures II as a new fund to the pension fund’s risk and private equity investment portfolio. Karma is an Estonian venture capital company founded in 2014 by Margus Uudam, Kristjan Laanemaa and Tommi Markus Uhar. The fund’s strategy is to invest in high-tech start-ups in Europe, including the Baltics. Pension Fund L is also an investor in Karma’s first fund with a similar strategy, which started investing in 2016 and has now successfully sold several portfolio investments.

October 2021: Stock markets recovered from the September decline

Kristo Oidermaa and Romet Enok, Fund Managers

October led to significant growth in most of the world’s stock markets. Measured in euros, the MSCI World index rose 5.8% during the month, the US index S&P 500 rose 7.2%, the European Stoxx 50 rose 5.1% and the MSCI Emerging Markets index rose 1.2%.

The odd one out was the Japanese Nikkei index, which decreased by 3.9% measured in euros, but we should keep in mind that it was one of the few winners in September. Local stock markets also grew in October, but at a somewhat more modest pace: the Tallinn stock exchange rose 1.4%, the Riga stock exchange rose 0.4% and the Vilnius stock exchange rose 2%.

Most of the companies in the fund’s portfolio reported good quarterly results during the month, as recovery from the pandemic supported profits. Profits grew the most in the energy and materials sectors, which are currently one of the key positions in our funds. Nordic listed companies, which are more dependent on the economic cycle, are also doing well and reported record quarterly profits. Investments related to precious metals, supported by growing inflationary pressure on the global economy, also contributed to the increase in the fund unit’s price.

At the end of the month, Partners Group, one of the world’s largest private equity companies, announced that its managed fund Partners Group 2019 had acquired a stake in the Swiss watch manufacturer Breitling. The company was founded in 1884 and has become one of the world’s leading manufacturers of luxury Swiss watches. LHV Pension Fund L has been an investor in the Partners Group 2019 fund since 2019. By now, the private equity fund includes 17 investments. Partners Group was founded in Switzerland in 1996 and it manages assets totalling more than 103 billion euros.

We added the shipping company Eckerö to our investments in the bond portfolio. The company borrowed funds for five years, will pay 7% interest above Euribor and the bond is secured by the passenger ship Finlandia. This is the company’s first bond issue.

In general, European bond markets had a weak month once again, and the market has fallen by around 3% since the beginning of the year. Of course, long-term government bonds have become even cheaper, which is why we are still completely abstaining from this asset class. Instead, we will continue to work with Estonian and Baltic companies, bringing together non-public market instruments.

Central bank support may not last forever
Andres Viisemann, Head of LHV Pension Funds

November started in a cheerful mood in the stock markets, which helped reach a new record high in both the European and US stock markets in the middle of the month. In the last weeks of the month, the mood changed and the stock markets reversed, leaving the MSCI World Index for November at 0.6% in euros. One reason for this was the spread of a new coronavirus variant that could lead to renewed restrictions on economic activities, which had almost revived in the meantime.