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In April – and against all odds due to the health contingency – pension multifunds the losses accumulated between January and March were reversed by more than 40%, then in the fourth month of the year all registered positive results.
According to the Profitability Bulletin prepared by the consulting firm Ciedess – based on data from the Superintendency of Pensions – the riskiest funds, Type A and B, recorded positive results of 8.61% and 7.86% respectively, while the moderate risk fund, Type C, presented a variation of 7.50%.
For its part, “the most conservative funds obtained gains of 6.87% for Type D and 5.06% for Type E”, detailed the analysis by Ciedess.
These monthly results are the best registered since the creation of the multifunds in the case of funds B, C, D and E, while for fund A it is the third highest result (after the two-month rebound after the subprime crisis, when in April and May 2009 this fund registered gains of 9.01% and 9.50% respectively) .
Losses are reversed
Although the multifunds have posted negative results so far in 2020, if the results accumulated as of March 31 are compared, it is recorded that a large part of the losses for the year – and even all of them – have been reversed after the returns of April.
So far from 2020, January to April, negative results are seen for all the multifunds, except for Type E. The riskiest funds, Types A and B, registered falls of -9.87% and -7.48% respectively, while the moderate risk fund, Type C, presented a variation of -5, 02%.
For its part, added Ciedess, the most conservative funds obtain mixed results, being -3.43% for Type D and 0.003% for Type E.
Comparing with the results accumulated as of March 31 of this year, it is recorded that a large part of the losses for the year, and even their entirety, have reversed after April returns (42% recovery of accumulated losses until March for fund A, 47% for fund B, 57% for C, 64% for D and 100% for E).
However, considering the profitability results for the January-April period of each year, Those for 2020 correspond to the worst start of the year for all multifunds since their origins.
“When analyzing the last 12 months, mixed results are seen for the multifunds. The Type A and B funds register losses of -2.03% and -0.73% respectively, while Type C presents a variation of 2.67%, “the consultant said.
Funds D and E record gains of 3.58% and 4.97%, respectively.
Return on investment in equity instruments
According to Ciedess, the monthly result of the A, B and C multifunds is explained mainly by the return on investment in equity instruments, both nationally and internationally.
“Although investments continue to be strongly influenced by the advance of the coronavirus Worldwide, this month there is a rebound due to the rebound effect of some markets, the application of fiscal policies to contain the crisis and the slowdown in the number of infected, “said the consultant in its report.
The world index (MSCI World Index) registered an increase of 10.80%, while the indices Dow Jones and S&P 500 obtained positive results of 11.08% and 12.68% respectively.
In turn, the indices of Europe (MSCI Europe) and Asia (MSCI EM Asia) showed gains of 5.66% and 9.12% respectively, while the index of Emerging Markets (MSCI EM) presented a variation of 9.00%.
“On the other hand, investment abroad was affected by the 1.14% decrease in the dollar, negatively impacting the riskiest funds, “said Ciedess.
At the local level, the IPSA recorded a nominal increase of 14.05%, mainly explained by the result of actions belonging to the services and electricity sectors.
Funds D and E
The profitability of D and E funds is mainly explained by the results of investments in local debt securities, as well as the performance of foreign fixed income instruments.
In this regard, Ciedess stressed in her report, a decrease in interest rates of national fixed income instruments, positively impacting conservative funds through capital gains.
“This occurs after the Central Bank will lower the rate to its historical minimum (as in the subprime crisis), it is projected that it will remain at these levels in the medium term, “said the consultant.
Historical returns
Since its creation -in September 2002- to date, the multifunds show positive real returns, which range from 3.94% per year in the case of E, an average that increases as the exposure in variable income instruments increases.
Thus, fund D has achieved 4.44% annually; Fund C has grown 4.87% real annually; Fund B – the one with the highest number of affiliates – has rented 5.03% and Fund A, with the most equity participation, has generated 5.79% of real annual return.
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