PFA, Copenhagen, returned a total 11.6 billion Danish kroner ($1.8 billion) for the nine months ended Sept. 30, buoyed by fixed-income and real estate allocations.
An update Monday did not provide an overall return in percentage figures. For the third quarter, the fund returned the equivalent of 13.4 billion kroner. Quarterly comparisons were not available. The fund lost 1.8 billion kroner on its investments in the first six months of the year and gained 13.7% or 57.3 billion kroner for the nine months ended Sept. 30, 2019.
The fund had 565 billion kroner in assets as of June 30. Figures as of Sept. 30 were not available.
The gain represented "a good comeback" from the situation in March and April, CIO Kasper A. Lorenzen said in the update. "The positive trend in the financial markets, where the losses have basically already been recovered, was very difficult to picture looking back six months."
The fund's bond portfolio gained 1.3% for the nine months vs. 5.8% in the period in 2019, while the real estate allocation gained 0.1% vs. 4.1%. However, alternatives returned -0.6% this year vs. an 8.6% gain and equities returned -2.6% for the period vs. a gain of 18.8% last year. The asset allocation was not available.
The update warned of the uncertain outlook for the economy. PFA said the long-term consequences of the "historically large monetary and fiscal initiatives" are unclear and the U.S. presidential election are reasons for caution.
"Of course, we relate to the fact that it is a very uncertain world we are living in and, therefore, there is reason for caution. Consequently, we constantly adjust our investment strategy and can react quickly in the changing markets," Mr. Lorenzen said. "This is our anchor in relation to the customers' savings, which we very much safeguard. But otherwise, our fundamental belief is in the good and broad portfolio that we have developed and which must function when the markets move up and down."
