Results and return 2018
The 2018 result including bank and administration fees amounted to SEK 142.9 million (SEK 761.6 million the previous year). The return on the overall portfolio amounted to 1.8 percent (10.3). This is 2.4 percentage points better than our benchmark index, but 3.2 percentage points lower than the real return target. This is the seventh consecutive year that the return exceeded the return of the weighted reference portfolio.
The equities fund
The equities fund contributed SEK 62.6 million net, but as shown in the table below there are large differences both between different markets (index) and different fund managers. The fund managers of asset classes Global Equities and Emerging Markets outperformed their benchmark indices by fully 7.0 and 6.5 percentage points respectively, while Swedish equities as a group had a negative result and in addition a return of 2.3 percentage points below index.
Fixed income investments
Fixed income investments contributed a return of 0.9 percent, in line with the index, while the corporate bonds fund declined 2.5 percent, which is 1.3 percentage points lower than the index.
The real estate asset class contributed a return of fully 6.3 percent. However, the return is largely based on annual external valuations of the various real estate funds that we have invested in. These valuations are made annually but are often presented well into the first quarter, which is why we get a lag of one year in valuation development. The return in the 2018 results therefore includes the valuation as of 31 December 2017.
Alternative investments gave a return of 5.2 percent, in line with the benchmark index of inflation plus 3 percent that we required from them. However, as previously stated, the running valuation of some of these unlisted and largely illiquid assets is often associated with a large portion of uncertainty. As in previous years, it is mainly SEB’s Microfinance funds which contribute to a steady ongoing return within this asset class. In most of the other holdings one has to wait until maturity before one can determine the result.