Equity on the rise
Your pension is funded mainly from return realised on the pension fund’s investments
Our investments are based on a long-term horizon. Are you enjoying your retirement already? Are you looking forward to the pension you'll get when you retire and the pension choices you’ll be able to make? Or is your retirement far in the future because you’re a young starter at ING? No matter what phase of life you're in, we fund your current or future pension mainly from return realised on the pension fund’s investments. The remainder is funded from contributions paid into the pension fund (totalling 30.5%). The employer's contribution is 23%, while your part of the contribution is 7.5% That's good to know isn't it?
In the second quarter, performance of the return portfolio was positive, mainly due to the increase of stock prices in the developed and emerging markets. The return portfolio also invests in small-cap equities (shares in companies valued at € 500 million to € 6 billion), non-listed real estate, high yield corporate bonds and investment grade corporate bonds.
Performance of the overall matching portfolio was negative. This portfolio invests in European sovereign bonds, bonds issued by semi-government institutions, covered bonds and residential mortgages in the Netherlands. The portfolio also contains interest rate swaps, which derive their value from the development of the market interest rates. The negative return was mainly the result of rising interest rates (causing negative returns on European sovereign bonds).
On balance, total return was -1.1%. Future developments of our investments will be published in our next quarterly report.
ING CDC Pensioenfonds assesses the performance of its investments by making a comparison with a benchmark derived from the strategic investment policy. A benchmark is a measure which is used to assess the performance of an investment portfolio. The total return is equivalent to a weighted average of the performance of the matching portfolio and the return portfolio.
Given that exchange rates play a major role in the foreign investments of the return portfolio, the pension fund largely hedges non-Euro currency fluctuations. The result of this currency hedging is added to the total return.
This Pension Overview has been carefully prepared. The final figures for 2024 will be published in the anual report. You cannot derive any any rights from this report.