LHV Pensionifond M
Active Management
10%
-10%
10%
10 year net yield
2
1
7
Risk level
35.84%
0%
100%
Invests into Estonia
13236
Fund investors

Suitable if

  • you have 3–10 years left until retirement age,
  • you have moderate risk tolerance,
  • your aim is the long-term stable growth of your pension savings.
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Strategy

When investing in assets, the fund prefers cash-flow assets and, where possible, the local market, including less liquid private equity and real estate investments. The investments are predominantly in local currency and up to 75% of the fund's assets can be invested directly in equities. The fund's long-term preferred asset class is real estate investments.

Performance
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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 30.06.2021

Biggest investments
France Government 2.25% 25/10/226.38%
German Treasury Bill 25/08/20215.23%
German Government 2.25% 04/09/214.53%
France Treasury Bill 25/08/20213.62%
EfTEN Kinnisvarafond3.39%
ZKB Gold ETF3.25%
Riigi Kinnisvara 1.61% 09/06/273.05%
Luminor 0.792% 03/12/242.47%
France Government 3.25% 25/10/212.33%
JP Morgan 1.375% 16/09/212.29%

Biggest investments in Estonia

Biggest investments in Estonia
EfTEN Kinnisvarafond3.39%
Riigi Kinnisvara 1.61% 09/06/273,05%
Luminor 0.792% 03/12/242.47%

Asset Classes

The data is presented as at 30.06.2021.

Information about the fund

Information about the fund
Volume of the fund (as of 30.06.2021)124,391,780.35 €
Management companyAS LHV Varahaldus
Equity in the fund400 000 units
Rate of the depository’s charge0,054% (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): 0.86%

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.

June 2021: The BaltCap fund sold its stake in a waste management company

Kristo Oidermaa and Romet Enok, Fund Managers

In June, world stock markets continued to rise in euros, supported to some extent by the 3.1% strengthening of the euro against the US dollar over the month. The MSCI World Index rose 4.6% in euros, and the US S&P 500 index rose 2.9%. The Nasdaq Composite index, which reflects the US technology sector, showed outstanding results, growing by 8.6% in euros.

In Europe, however, the Euro Stoxx 50 performed modestly, rising 0.7%. Japan’s Nikkei index rose 1.5% in euros, and the MSCI Emerging Markets index rose by 3.1%. Of the local Baltic stock markets, Tallinn and Riga remained on the rise, growing by 2.3% and 3.6%, respectively, in June. The Vilnius stock market showed a completely different result, falling by 1.5%.

At the end of June, the domestic private equity company BaltCap announced that their BaltCap Private Equity Fund II would sell its 75% stake in Eesti Keskkonnateenused AS. The buyer was MBA Investeeringud OÜ, owned by the management members and shareholders of Eesti Keskkonnateenused AS. Eesti Keskkonnateenused AS provides waste management services in Estonia, and the BaltCap fund made its investment in 2015. Within six years, the company has grown organically and through five acquisitions, resulting in a strong market position and a wide range of services.

In the bond portfolio, the month brought news about our two investments, Sunly and Ekspress Group. The latter plans to sell its printing business and focus on developing digital media. Sunly announced the raising of large amounts of money through the addition of new shareholders. The news from both companies is clearly positive for the bond investor and shows that the companies are developing in the right direction.

As a major new investment, we acquired the bonds of Eastnine, a real estate company focused primarily on office buildings in Vilnius. The company issued bonds for the first time, the money was borrowed for three years, and investors are paid 5% interest per annum. We see an opportunity for a further price rise of the bond, which could bring the desired minimum return of 6–7% to the fund.

Bond markets on European stock exchanges were in clear decline in the first half of the year, and we will continue to focus mainly on OTC opportunities.

May 2021: The stocks of several Lithuanian listed companies rose sharply

Kristo Oidermaa and Romet Enok, Fund Managers

In May, world stock markets moved at a modest pace. The MSCI World index, measured in euros, remained almost at April’s level, falling by 0.1%. The S&P 500 index, which reflects the US stock market, fell 0.9% in euros during the month, the Japanese Nikkei index fell 1.6%, and the MSCI Emerging Markets index rose 0.4%.

The Euro Stoxx 50 performed somewhat better and rose 2.3% in May. The Austrian, Italian and Spanish stock markets stood out in particular, growing by 6.3%, 4.3% and 3.8%, respectively. On the other hand, the Baltic stock markets showed quite mixed results: while the Tallinn stock market index was almost the same as in April, the Vilnius and Riga stock markets grew by 6.2% and 2.7%, respectively, during the month.

Regarding Baltic stocks in the portfolio of Pension Fund M, the Lithuanian banking company Šiaulių bankas, the Lithuanian timber industry company Grigeo and the tour operator Novaturas continued to show outstanding growth in May and rose by 17.1%, 16.5% and 14.5%, respectively. Grigeo paid an attractive dividend to investors and also announced a bonus issue of shares. The optimistic outlook for travel activity can explain the rise in the Novaturas share price.

Concerning our bond portfolio, we sold the bonds in the Lithuanian state energy company Ignitis in May. The company raised funds through the bond issue in May last year, and since then, the price of the bonds had risen by a little more than 10%. In addition, the bonds have an annual interest rate of 2%.

As regards new investments, we moved on with Sunly bonds at the end of the month. The development of the company’s solar parks has reached a stage where the fund subscribed for the next tranche of Sunly bonds. If all the assumptions are met, the bond will become one of the fund’s largest investments in the next stages of development. The bond has an interest rate of 8% per annum, and the maturity term is 2025.

April 2021: Stock markets slowed down

Kristo Oidermaa and Romet Enok, Fund Managers

In April, world stock markets continued to rise, but at a slightly slower pace than in February and March. The MSCI World index rose by 2.2% during the month measured in euros, and the Euro Stoxx 50 index also rose by 1.8%. Among European countries, Finland was a powerful performer with its market index rising by 4.2% in April. The Japanese Nikkei index, on the other hand, fell 1.3% in local currency and 2.4% in euros. The Baltic stock markets were very strong in April. The Tallinn stock market index rose the most, 7.7%, while the Vilnius and Riga markets rose by 4% and 3.2%, respectively.

The portfolio of Pension Fund M includes a fund managed by the Finnish private equity firm KJK, which announced a 66% acquisition of the Alwark Group. Founded in 2007 in Lithuania, Alwark Group sells, rents and maintains heavy equipment, such as warehouse, seaport and airport equipment. Alwark operates in Lithuania, Latvia and Estonia, and the company’s sales last year amounted to 43 million euros. The KJK III private equity fund started investing in 2018 and Alwark is the fund’s fourth investment.

International bond markets continue to be under pressure if interest rates rise. The prices of very long-term government bonds have already fallen by more than 10% since the beginning of the year. As countries support their economies during recovery from the coronavirus crisis, this may have the side effect of a price rise, which is a great fear for bond markets.

As we have already assured in our monthly reviews, LHV pension funds do not have any such long-term fixed-interest investments. Instead, we continue looking for new investments in local companies, and over the past month we have made significant progress with a few potential deals. However, large price movements in international markets may open up additional opportunities for us to make new investments there as well.

Investors’ risk appetite continues to raise asset prices
Andres Viisemann, Head of LHV Pension Funds

June was another good month that exceeded expectations in the international securities markets: Shares of large US companies rose 5.4% in euros. The rise in European stock markets was somewhat smaller, reaching 1.6%.