Over Half of Denmark’s Pension Sector Investments Allocated to Stocks

The investment landscape of Denmark’s insurance and pension companies reveals a noteworthy shift, with equity investments, both listed and unlisted, now constituting over 51% of their total investments. This marks a significant increase from 42% at the beginning of 2018. Several factors contribute to this surge, including higher returns on stocks compared to bonds during the period and an increased focus on market-rate products by insurance and pension firms.

The rise in equity exposure is partly attributed to the popularity of market-rate products, which come with varying degrees of risk. Overall, these products have a higher share of stocks in their portfolios compared to average-rate products, which are typically invested with lower risk. The trend suggests a strategic move by insurance and pension companies towards a more diversified and potentially higher-yielding investment approach.