Swiss pension fund Stiftung Abendrot plans to review its investment strategy in the coming months.
In a newsletter to members, the CHF1.3bn (鈧�1.06bn) collective scheme said it wanted to determine whether its current asset allocation had to be adjusted to account for 鈥渆conomic developments鈥�.
The Stiftung Abendrot is to consider, among other things, whether stock markets are 鈥渁lready overheated鈥�, as well as what to do about the impact of rising interest rates on fixed income holdings.
As one of its 鈥渕ajor challenges鈥�, the pension fund cited a possible need to re-arrange its real estate portfolio, adding that it was already 鈥渨ell on the way鈥� to increasing its exposure to the asset class.
鈥淚n reviewing the investment strategy,鈥� it said, 鈥渨e are also interested to see whether we can achieve additional returns 鈥� without adding any major additional risks 鈥� by small shifts in the weighting of the individual asset classes.鈥�
At the end of 2013, the pension fund had just over one-third of its assets in fixed income, almost 25% in equities and a quarter in real estate.
The rest was invested in liquidity and mortgages, with no exposure to alternative investments.
The Stiftung Abendrot, a member of the Ethos foundation, is committed to socially responsible investment.
In 2013, the pension fund returned 6.34%, in-line with the Swiss average.
However, the net return was slightly lower at 5.5%, with the Stiftung Abendrot citing approximately CHF10m in real estate investments 鈥渘ot yet generating profits鈥�.
For the first half of 2014, the pension fund reported a return of around 3%, 100 basis points below the Swiss average.
However, the scheme managed to achieve a funding level of 109.9%.
