Zurich (awp) – Swiss pension institutions experienced a decline in performance in October. Among the asset classes they invested in, hedge funds and private placements had the best returns.
Over the month under review, the 100 pension funds analyzed by UBS achieved an average performance down -0.59% after deduction of fees, varying between -1.52% and 0.23% depending on the fund, indicated Monday the number one Swiss bank. The yield has increased by 6.20% since the start of the year and the annualized yield by 3.13% since measurements began in 2006.
Generally speaking, small Swiss pension institutions (-0.64%), i.e. those with assets under management of less than 300 million Swiss francs, did less well than those managing assets between 300 million and 1 billion (-0.51%) or those with assets exceeding one billion Swiss francs (-0.58%).
By asset class, hedge funds (2.26%), private investments (1.60%), indirect (0.37%) and direct (0.18%) real estate investments, infrastructure (0 .17%), Swiss franc bonds (0.05%) showed a positive development in October. On the other hand, global stocks (-0.55%), foreign currency bonds (-0.87%) and Swiss stocks (-3.46%) struggled.
In the coming months, investors should prepare for lower interest rates, while the conflict in the Middle East could occasionally affect global markets, UBS writes in its press release. Although bouts of volatility in the markets are expected in the coming months, the three-key bank believes that solid economic growth and rate cuts by the US Federal Reserve (Fed) will provide a favorable environment for stocks and bonds.
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