LHV Pensionifond XL
Active Management
10%
-10%
10%
10 year net yield
3
1
7
Risk level
23.75%
0%
100%
Invests into Estonia
38906
Fund investors

Suitable if

  • you have more than 15 years left until retirement,
  • you are prepared to take above-average risks,
  • your aim is the long-term growth of your pension savings.
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Strategy

The Fund prefers foreign markets, more liquid and traded instruments on regulated markets when investing assets. The assets of the Fund may be invested in their entirety in equities, equity funds and other equity-like instruments. The Fund is allowed to borrow up to 10% of the Fund's assets value. The long-term preferred asset class of the fund is public equity 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 31.03.2021

Biggest investments
German Government 2.25% 04/09/215.45%
France Government 3.25% 25/10/215.20%
German Government 3.25% 04/07/215.03%
France Government 3.75% 25/04/214.75%
France Government 25/05/214.23%
German Government 1.5% 04/09/223.67%
German Treasury Bill 14/04/20213.14%
ZKB Gold ETF2.56%
German Government 1.5% 04/09/222.50%
EfTEN Kinnisvarafond2.49%

Biggest investments in Estonia

Biggest investments in Estonia
EfTEN Kinnisvarafond2.49%
Riigi Kinnisvara 1.61% 09/06/272.10%
East Capital Baltic Property Fund III1.83%

Asset Classes

The data is presented as at 31.03.2021.

Information about the fund

Information about the fund
Volume of the fund (as of 31.03.2021)257,689,721.38 €
Management companyAS LHV Varahaldus
Equity in the fund530 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): 1.13%

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.

March 2021 – Stock markets largely continued a hearty upward trend

Kristo Oidermaa and Romet Enok, Fund Managers

The stock market indices of developed countries continued their strong upward trend in March. The Euro Stoxx 50 index, which tracks large European companies, rose by as much as 7.9% during the month, with the German, French, Italian and Swedish stock markets being among the strongest. For example, the German stock exchange index DAX rose 8.9% in March, and the return on the Stockholm stock market, measured in euros, was 8.5%.

However, the performance of the Japanese Nikkei index remained modest last month: 0.7% in local currency and -0.1% in euros. The global MSCI Emerging Markets Index was ˗1.7% in local currency. The decline was driven by Asian stock markets, led by China, where the index returned ˗6.1%. In the Baltic countries, the Tallinn stock market index rose the most by 3.3%. The Vilnius and Riga stock markets fell by 0.2% and 5.2%, respectively.

The share of Volkswagen, a car manufacturer in the pension fund’s portfolio, rallied by almost 38% in March. The company has announced a long-term strategy for its electric car business, which is aggressive and offers strong competition to Tesla, which currently dominates the electric car market. It is also possible that minority interests in the subsidiaries manufacturing Porsche and Audi vehicles will be listed, which could further increase Volkswagen’s value.

Stocks of gold mining companies, which have been under pressure in recent months and recovered in March, also brought good returns to the pension fund.

In our bonds portfolio, we updated the terms of our Alexela investment. Since our investment in early 2018, the company has grown considerably and improved its results. Therefore, some of the restrictions imposed on the company by our bond were already unnecessary. As part of the amended conditions, the money will be returned to the funds in 2023, as much as five years earlier than initially planned.

February 2021: investment in a Swedish real estate management company

Kristo Oidermaa and Romet Enok, Fund Managers

In February, the stock markets of developed countries continued to deliver largely positive returns in anticipation of loose monetary policy and new support measures. The Euro Stoxx 50 index, which tracks large European companies, rose by as much as 4.5% during the month, with France, Italy and Spain being the strongest. The German stock market index DAX returned 2.6%, and the Stockholm market rose 2.7%, measured in euros.

The Helsinki stock market index stood at 0.9% in February, while the Japanese Nikkei stock index rose 4.7% in local currency and 3.2% in euros. Among the Baltic countries, the Tallinn stock market had the best return, with an increase of 1.2%. The return on the Riga stock market index was 0.5%, and the Vilnius stock market fell 1.3% during the month.

LHV pension funds were negatively affected by the gold mining companies in the portfolio. For example, the shares of Agnico Eagle Mines and Barrick Gold fell by as much as 19.6% and 16.1%, respectively, during the month. This can be attributed to the rise in real interest rates and the shift in investors’ attention to value stocks and assets that provide inflation protection.

The German car manufacturers Daimler and Volkswagen gave a decent positive return, with stocks rising by 14% and 10.6%, respectively. Although car sales are still poor, they are expected to recover. The Swedish company Coor Service Management was added to the equity portfolio as a new investment. The company offers a wide range of property management services in the Scandinavian countries and earns a stable cash flow.

Sunly succeeded in the Polish renewable energy auction and thus fulfilled an important precondition for raising long-term capital from pension funds. Once the rest of the preconditions are met, the bond used to finance the construction of solar parks will become one of our largest investments in the coming quarters. The bond has a maturity term of five years and an interest rate of 8% per annum.

Although national programmes to increase the share of renewable energy are significant in their scope, the private sector often plays a critical role in implementing projects. Pension funds have a clear advantage here as a provider of long-term capital. As assets are extremely highly-priced on stock markets, we will continue to find attractive direct investment projects.

January 2021: we made a new investment in a silver miner

Kristo Oidermaa and Romet Enok, Fund Managers

January was relatively calm on world stock markets after a strong end to 2020, and the main stock market indices moved slightly and in different directions. The Euro Stoxx 50 index, which tracks large European companies, fell by 1.9% during the month. The German stock exchange, for example, was among the biggest losers with -2.1%, while the Swedish and Finnish stock exchange indexes rose by 4% and 2.1%, respectively.

Measured in euros, the US market index S&P 500 fell by 0.4% during the month and the Japanese Nikkei index rose by 0.7%. However, the global index for emerging markets offered a strong yield of 3.8% measured in euros, largely due to a more than 8% rise in the Chinese stock market. The Baltic stock markets were also strong in January. Tallinn stock market yield was 6.9%, the Vilnius stock market index rose by 5.6% and the Riga stock market by 2.6%.

The performance of Pension Fund XL was driven again by investments in mining-related companies, whose stocks rose in anticipation of larger economic recovery packages.

As a new investment, we added Pan American Silver Corp., a company that mines and processes silver and owns mines in several Latin American countries. However, we sold the investment in the copper mining company KAZ Minerals, as its management announced plans to buy out the company. The pension funds earned more than 150% on the investment.

Bond markets remained largely negative in the first month of the year in Europe, the United States and emerging markets. The decline was not sharp, but the US and especially German markets have been steadily declining since early November, when the results of the Pfizer/BionTech vaccine clinical trial became available. The movement of these two anchors has had a very wide-ranging impact on the markets.

Despite a slight fall in prices (and rising interest rates), sales of new securities continue to grow strongly: in January, for example, European countries borrowed a total of about 40% more than in January 2017. There is currently no alternative to borrowing to compensate for the reduced tax revenue.

We have refrained from acquiring high-risk bonds for the fund. Major local companies in the fund’s portfolio have so far reported expected or even higher-than-expected results.

The economy is starting to grow again
Andres Viisemann, Head of LHV Pension Funds

March was another great month for stock markets. The US stock market rose 7.2% in euros and the stocks of European companies rose 6.1% during the month. Asian stock markets were less optimistic: The Chinese stock market lost 3.7% of its value in euros during the month.