II pillar

LHV Pensionifond S
Active Management
10%
-10%
10%
10 year net yield
2
1
7
Risk level
10.35%
0%
100%
Invests into Estonia
8417
Fund investors

Suitable if

  • you have 2–5 years left until retirement age,
  • you have low risk tolerance,
  • your aim is the preservation and modest growth of your pension savings.
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Strategy

The Fund's assets are mainly invested in bonds. The Fund's assets may be invested in sub-investment grade bonds. Up to 25% of the fund's assets may be invested in real estate, infrastructure, equity funds and convertible bonds. The Fund may also grant a loan. The long-term preferred asset class of the fund is listed debt instruments.

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 31.12.2020

Biggest investments
Temasek 0.5% 01/03/224.98%
Latvenergo 1.9% 10/06/224.88%
Riigi Kinnisvara 1.61% 09/06/274.49%
France Government 3.25% 25/10/213.98%
German Government 3.25% 04/07/213.98%
France Government 3.75% 25/04/213.70%
Transpordi Varahaldus 2.85% 18/04/253.59%
France Government 25/05/213.38%
Ignitis Grupe 2% 21/05/303.34%
German Government 2.25% 04/09/213.27%

Biggest investments in Estonia

Biggest investments in Estonia
Riigi Kinnisvara 1.61% 09/06/274.49%
Transpordi Varahaldus 2.85% 18/04/253.59%
Luminor 0.792% 03/12/242.07%

Asset Classes

The data is presented as at 31.12.2020.

Information about the fund

Information about the fund
Volume of the fund (as of 31.12.2020)53,420,434.03 €
Management companyAS LHV Varahaldus
Equity in the fund150 000 units
Rate of the depository’s charge0,0552% (paid by LHV)
DepositoryAS SEB Pank

Entry fee: 0%

Exit fee: 0%

Management fee: 0.60%

Success fee: no commission

Ongoing charges (inc management fee): 0.69%

Ongoing charges are based on expenses for the last calendar year, ie 2019. Ongoing charges may vary from year to year.

December 2020: little to win but much to lose on bond markets

Kristo Oidermaa and Romet Enok, Fund Managers

The coronavirus in the spring shocked bond markets around the world. In both Europe and the United States, the markets for weaker corporate bonds fell by around 20%. The central banks’ response was as sharp and strong as the market panic in February. As hope for the success of vaccine production rose in the autumn, almost all market segments had clear positive returns by the end of the year.

We have been avoiding increasing risks in the bond portfolio for a long time, because there would be very little to gain, yet much to lose – not least because of the extremely high price level of bonds. In the spring, however, we made a new large investment when the Lithuanian state energy company Ignitis raised money for investments.

As another major investment, we acquired Estonian government bonds when the government decided to replenish state reserves. However, we sold the bonds a few weeks later with a profit of a few percent because their expected future yield was almost non-existent.

At the end of the year, the fund’s portfolio still consists largely of high-rated short-term bonds.

November 2020: new Luminor bonds replace the old

Kristo Oidermaa and Romet Enok, Fund Managers

In November, as Luminor redeemed its bonds before maturity and issued new ones, we replaced Luminor’s bonds in our portfolio. Fund XS participated in both the resale of old bonds and the subscription of new ones.

At a time when deposit rates are close to zero, bonds in some cases still offer earning opportunities. Interest on Luminor’s old bonds has been 1.5% per annum for the past two years, and the bank paid a little over 1% for the premature redemption. Even as I write, the price of the new bond has risen by about 0.5%.

October 2020: there are only a few attractive investment opportunities on the market

Kristo Oidermaa and Romet Enok, Fund Managers

Bond markets around the world did not show a clear trend or result in October: The outcome in Europe was rather on the positive side, but negative in the USA and the world as a whole. The non-existent risk premium; that is, low interest rates for companies, is an even higher risk than the low government interest rates.

In such a situation, there are still very few attractive investment opportunities that would promise a price increase at an acceptable level of risk. However, there are some such bonds: during the month, one of our largest investments, the long-term bond for the Lithuanian energy company Ignitis, offered a yield of more than 2.5%. After going public, the company has a larger capital base and investor circle, as well as better future prospects. On this wave, the bonds purchased in May have yielded over 10% for the fund.

At the same time, the broader performance of public bond markets since the beginning of the year is still poor as is the future outlook.

Those who accumulate reserves will do better
Andres Viisemann, Head of LHV Pension Funds

A very dramatic, at times even surreal 2020 is finally behind us. Both people and companies were forced to make difficult choices about how to reorganise their lives. Last year taught us that self-sufficiency can be more important than short-term efficiency, and that reserves are needed even if it’s just to be able to wait for help.