06 Sep 2018
AXA Mansard, Premium and Stanbic IBTC pensions lead fund performance in 2018
Wednesday 08 August 2018, Business Day
AXA Mansard RSA account holders have a good reason to smile this year. The fund administrator has the best performing RSA fund account in Nigeria in the first seven months of the year with a year to date return of 7.9 Percent.
Behind AXA Mansard Pensions was Premium Pension (7.6 percent), Stanbic IBTC Pension (6.9 percent), ARM Pensions (6.7 percent), PAL Pensions (6.7 percent) and Legacy Pensions (6.7 percent) whose strong performance propelled the PFAs to become among the six best performing retiree fund in the country.
The performance analysis was done using the fund IV unit price returns of 10 pension fund administrators in Nigeria between January 2nd 2018 and July 31st 2018.
A pension fund is a pooled contribution from pension plans organized by employers or organizations to provide retirement benefits for their employees or members.
Pension funds are the largest investment blocks in most countries and dominate the stock market where they invest. These funds are managed by pension fund administrators all of which are licensed b the national pension commission.
There are currently 21 pension fund administrators in Nigeria. This number of registered PFAs has dropped over the years from 24 in 2011 to 21 in 2016.Others not included in this analysis due to unavailability of fund IV unit price data include APT pension, First Guarantee Pension Ltd, Investment One Pension managers, Leadway Pension, NFP Pension Ltd, Radix Pension Managers, AIICO Pensions, NPLC Pension, Veritas Glanvills, Sigma Pension and Trust Fund Pension.
Others that lagged the high flyers include; Crusader Pension (6.5 percent), OAK Pension (6.40 percent), Fidelity Pension (6.3 percent) and IEI Anchor Pension (5.9 percent).
On the reason why some pension fund managers out-performed others, Henry Ogbuaku, group head, Asset Management at GDI, Asset Management Ltd earlier told BusinessDay that there are some key factors which could have led to the disparity in their fund performance. One of them is the capacity of the managers in terms of their understanding of the market. It is also important to know what constitutes their portfolio. Based on the Security and Exchange Commission (SEC) regulation, each fund manager is supposed to structure their portfolio in a particular way. For example, there is a limit to the proportion of their AUM that goes into equity and a certain amount goes into fixed income. The ability of the fund managers to understand each of those markets is an important factor.
It also depends on their investment strategy, that is how they choose to classify their bond and equity portfolio will affect their performance. If they are bullish on fixed income or equity, it will affect their performance differently, BusinessDay gathered from another source who pleaded anonymity.