Unlike its peers, Swedish pension backup fund AP6 saw very positive returns in 2018, but those rewards are bittersweet as its chief is leaving.
The retirement reserve raked in 9.6% from its investment portfolio, increasing its assets to $3.7 billion. AP6 prides itself on its allocations to unlisted assets, and with good reason.
The space provided 16.1% returns for the year, which helped the fund average a 13.2% return over the last five years, outperforming its benchmark by 1.6 percentage points..
However, AP6 was not as effective as 2017, where it returned 12.3%, with a 20.3% harvest from unlisted assets. It has still had a superior performance than several of the other four AP funds in 2018, which watched a rough stock market wash away anticipated positivity.
Outgoing Managing Director Karl Swartling said the returns came from areas that “have the highest return in sub-segments and geographic locations,” adding that performance results were high for both direct and fund investment sections of its portfolio.
The alts-oriented fund announced Swartling’s departure days before the news. He will leave on March 1 after seven years on top, to lead an undisclosed business after the summer. Deputy Managing Director Margareta Alestig Johnson will be the acting chief until it finds a new leader.
“It has been seven eventful and very developing years. When I took office, the Board had decided on a new overall strategy,” said Swartling, alluding to its unlisted assets focus and private equity portfolio. “AP6 has very competent and professional employees that I will miss.”
From 2014 through 2017, the fund had restructured by splitting two-thirds of its portfolio between direct (39%) and fund investments (37%), spread across the consumer discretionary, industrial goods, IT/telecom, and health care sectors. The remaining 24% of AP6’s portfolio is in liquidity investments. It has completely divested from all holdings that predate this implementation.
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