LHV Pensionifond M

Active Management
10%
-10%
10%
10 year net yield
2
1
7
Risk level
43.46%
0%
100%
Invests into Estonia
7779
Fund investors

Suitable if

  • you have 3–10 years left until retirement age,
  • you have moderate risk tolerance,
  • your aim is the long-term stable growth of your pension savings.
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Unit NAV
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Strategy

When investing in assets, the fund prefers cash-flow assets and, where possible, the local market, including less liquid private equity and real estate investments. The investments are predominantly in local currency and up to 75% of the fund's assets can be invested directly in equities. The fund's long-term preferred asset class is real estate 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 31.12.2022

Biggest investments
German Treasury Bill 22/02/237.98%
Luminor 0.792% 03/12/245.02%
ZKB Gold ETF4.43%
EfTEN Kinnisvarafond4.05%
France Government 25/02/233.98%
Riigi Kinnisvara 1.61% 09/06/273.80%
SG Capital Partners Fund 12.75%
Eastnine 08/07/242.32%
iShares Gold Producers UCITS ETF2.13%
Baltic Horizon Fund 4.25% 08/05/232.08%

Biggest investments in Estonia

Biggest investments in Estonia
Luminor 0.792% 03/12/245.02%
EfTEN Kinnisvarafond4.05%
Riigi Kinnisvara 1.61% 09/06/273.80%

Asset Classes

The data is presented as at 31.12.2022.

Information about the fund

Information about the fund
Volume of the fund (as of 31.12.2022)100,044,307.24 €
Management companyLHV Varahaldus
Equity in the fund400,000 units
Rate of the depository’s charge0.0444% (paid by LHV)
DepositoryAS SEB Pank

Entry fee: 0%

Exit fee: 0%

Management fee: 0,6240%

Success fee: Performance fee is 20% of the positive difference between the fund's performance and the benchmark, maximum of 2% per annum of the fund's volume. Performance fee for 2021 0,00%.

Ongoing charges (inc management fee): 1,17%

The ongoing charges figure is an estimate based on the current management fee and the 2021 level of all other recognized costs. Ongoing charges may vary from year to year.

December 2022: Coop Pank redeemed bonds prematurely

Kristo Oidermaa and Romet Enok, Fund Managers

In December, world stock markets mostly fell. Measured in euros, the MSCI World index fell by 7.6%, the US S&P 500 index fell by 9.4%, and the Nasdaq Composite index, which tracks the US technology sector, fell as much as 12.1%. The Japanese Nikkei index fell 4.4%, the European Euro Stoxx 50 index 4.3% and the MSCI Emerging Markets index 5.3%, measured in euros. The Baltic stock markets stood out last month: the Tallinn, Riga, and Vilnius stock markets rose by 0.4%, 3.4% and 0.1%, respectively.

In our portfolio of over-the-counter investments, BaltCap’s two funds had news in December. The Adoro company in BaltCap Private Equity Fund III is acquiring the social welfare centre Dzīves Ābece in Latvia. The centre was established in 2018 and currently has 97 beds. The BaltCap Infrastructure Fund announced having reached an agreement to build a new police department worth 21.9 million euros in Šiauliai, Lithuania. The development should be completed in three years, after which the company belonging to the fund will also provide administrative services for the building for a period of 12 years. The approximately 5,200 sq m building will have four floors for 245 employees and a car park for 270 cars.

In the bond portfolio, Coop Pank called its subordinated bonds ahead of schedule, but as planned. The bonds were issued directly to LHV pension funds in 2017 and earned a total return of approximately 35%. LHV funds were the first institutional investor in the new bank. The company has developed rapidly and now involves capital through the stock exchange.

European bond markets remained clearly in the red in December, showing once again the value of financing Estonian companies, both in developing the local economy and in achieving a higher return on pension assets.

The year 2022 was particularly difficult for the public bond markets: for example, the European market offered an average return of –17%, and Estonian government bonds fell as much as 21%. Fearing risks, we have avoided public bonds in recent years, but the new year may start offering new opportunities in this area.

November 2022: Stock markets continue to recover

Kristo Oidermaa and Romet Enok, Fund Managers

In November, the world’s stock markets continued to rise, and the euro strengthened significantly. Measured in euros, the MSCI World index rose by 2.7% and the US S&P 500 index by 1%, but the Nasdaq Composite index, which tracks the US technology sector, remained almost at the same level as in October, measured in euros. Japan’s Nikkei index rose by 3.6% in euros in November.

We experienced strong growth in European stock exchanges in November, when the Euro Stoxx 50 index rose by 9.7%. The same trend persisted in emerging markets: the MSCI Emerging Markets index rose by 9.9% measured in euros. While trends in the Baltic stock markets are often mixed, this month the Tallinn, Riga, and Vilnius markets moved in the same direction and rose by 5.3%, 5% and 4.7% respectively.

In November, two Estonian private and venture capital funds sold one investment each. A private equity fund led by Livonia Partners announced selling the window manufacturer Fenestra to Trigon Capital. Livonia invested in Fenestra in 2019, and after its sale, five more companies remain in the fund’s portfolio. Also, the local private equity company BaltCap announced that the BaltCap Latvia Venture Capital Fund, which they manage, was selling the digital medical services provider Blue Bridge Technologies. The company was founded in 2007 and BaltCap invested in it six years later. Blue Bridge Technologies was sold in its entirety to the software investor Everfield.

Last month was positive for the fund’s stock investments. Shares of gold mining companies, the value of which increased by 4–14%, contributed the most to the increase in the price of the fund’s unit. We saw a decline in energy stocks, where we also locked in gains from this year’s rise during the month.

The fund’s key positions on the stock markets remain primarily in investments related to mineral resources. In November, we reduced our funds’ equity investments in US energy companies to create liquidity for new purchases. We look forward to putting money back into better priced stocks during a more nervous market phase.

As the most significant news from the companies in the fund’s bond portfolio, Coop Bank raised a large amount of funds through the stock exchange. Strengthening bank reserves before an economic downturn is a very good idea from our fund’s point of view. LHV funds have financed Coop’s growth over the years with various bonds. As the latest investment last summer, we subscribed to long-term securities with 10% annual interest. The current securities issue is subordinated to our bonds and thus further increases the value of the bonds in the fund.

October 2022: Stock markets recovered from the decline

Kristo Oidermaa and Romet Enok, Fund Managers

In October, world markets recovered. The MSCI World Index, the US S&P 500, the Japanese Nikkei Index, and the European Euro Stoxx 50 rose 6.2%, 6.9%, 2.5% and 9.1% in euros, respectively. However, emerging markets moved in the opposite direction: the MSCI Emerging Markets index fell by 4.1% in October. Compared to world stock markets, the Baltic stock exchanges remained relatively neutral: during the month, the Tallinn and Riga stock exchanges fell by 0.6% and 0.4%, respectively, and the Vilnius stock exchange rose by 1%.

In October, the private equity firm BaltCap announced that its managed fund, BaltCap Private Equity Fund III, will buy Estonia’s largest bookseller Rahva Raamat and merge it with the Lithuanian publishing and trading company Alma Littera, which it acquired in September. Rahva Raamat has a comprehensive e-shop and 12 brick-and-mortar stores in eight Estonian cities.

Following the bond market price drop in recent months, we acquired a new larger position for the fund. The bonds of one of Europe’s most important banks, the French BNP Paribas, offer an annual return of more than 6% at our purchase level.

At the same time, we signed a bond investment agreement with an Estonian company, as Dimedium Grupp raised money from the funds to buy out some of the company’s previous owners. The loan is for three years, with an annual interest of 10%, to which an additional payment will be added at redemption.

Interest rates have risen sharply, and as a result, international bonds offer increasingly strong competition to domestic transactions. We are actively seeking opportunities in both areas.

The rising price of money led to a decline in asset prices
Andres Viisemann, Head of LHV Pension Funds

The year 2022 was pivotal for securities markets. In early January, several of the world’s largest and most important stock indexes were at all-time highs, and global bond markets held more than 10 trillion dollars worth of low-risk bonds that investors were willing to pay to hold.