The market value weighted return on the investments by the State Pension Fund of Finland (VER) reached 4.0 per cent in 2020 (13.8 per cent in 2019). The real rate of return was 3.8 per cent (12.8 per cent).
VER primarily seeks a long-term return sufficient to finance the state pension system. VER’s average nominal rate of return over the past ten years is 5.5 per cent and real return 4.3 per cent. The average nominal five-year return is 5.4 per cent and real return 4.6 per cent.
At the end of 2020, the market value of the Fund’s assets amounted to EUR 21.0 billion (EUR 20.6 billion in 2019). Of all the investments, fixed income instruments accounted for 36.2 per cent and equities 52.4 per cent, while the rest consisted of other investments and the impact of derivatives.
Of the large asset classes, listed equities generated a return of 6.2 per cent and liquid fixed income instruments 2.1 per cent. Of the other asset classes, the best performance was put in by non-listed equities at 12.2 per cent, infrastructure funds at 12.2 per cent and private equity funds at 6.6 per cent.
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