Our asset management

The insurance premiums paid into the society together make up the assets that we manage. We have long experience of strategic investment management and our main goal is the creation of good long-term returns on your pension capital.

Insurance with a guarantee

A traditional pension insurance means among other things that the capital is guaranteed not to reduce in size. The guaranteed rate the society gives you on every paid-in premium over time is approximately 2% below the current level of government bonds, the “risk-free interest”. It is the difference between these two interest rates which makes it possible for us to invest some of your capital in assets with a higher expected return but
also a higher risk.

Solvency ratio – the balance between guarantee and surplus

The society builds up a common risk capital based on paid-in premiums and the surplus created by investment management over time. The extent to which the assets exceed the society’s commitments to its members is called the solvency ratio. The society has an adequate solvency ratio but this varies between years in step with the value changes in assets and liabilities. If you would like to read more about the society’s investment strategy and solvency ratio you can find the society’s annual report on our website kapan.se.

Balance between risk and return

Managing assets within the framework of a traditional pension insurance relies on finding a balance between taking risks and expected returns. Capital is therefore invested based on the society’s investment policy which has been produced by the society’s Board. The policy states that investments shall be made in many different asset classes. Investments shall also be made in many different securities so that no single investment constitutes too big a risk. You can read more about our investment policy on our website kapan.se.

Investments in different asset classes

Based on the investment policy, we split the managed capital across three main investment areas, equities, bonds and property. Together these
constitute a well-balanced portfolio. Fixed-income securities are expected
to provide stable returns and performance over time. Equities are more
risky investments which means that the performance can swing both up and down but are expected to give a higher return over time. Investments in real estate and similar assets provide a good complement to investments
in equities and fixed-income securities. All assets are continuously given
a market value so that we always have the value of the society’s assets.
The increase in value accrues to your insurance in the form of bonus
interest.

Our asset management model