Swiss pension funds (PFs) manage assets of almost CHF 1,200 billion. The big banks and Swisscanto publish regular "monitors" on this,
which report on the average returns of the respective "size segments" of the pension funds. These publications cover approximately 70% of the total pension fund assets in Switzerland.
The first Pictet BVG Index goes back to the year 1985 and was established shortly after the introduction of the BVV2 ordinance. Since 1993 are these indices known as “Pictet BVG 93 Index”
and are considered as benchmark indices for Swiss Pension Funds. They are continuously adjusted to the revisions of the ordinance and are now grouped as Pictet BVG25, BVG40 and BVG60 (see table).
The average real returns achieved by Swiss pension funds are surprisingly constant and very close to the following Pictet benchmarks
Average gross annual returns of Index: over years:
Pictet BVG 25 (25% equities)
Pictet BVG 40 (40% equities)
Pictet BVG 60 (60% equities)
27 years (incl. various crises since 1994)
14 years (incl. 2008 financial crisis and Corona crisis)
14 years UBS Pension Fund Monitor (av. 33% equities)
* no average returns of the PF monitors over 27 years are available. However, these yields should be around 4.6%.
Source: Banque Pictet & Cie SA, January 2021
Check for yourself how close the results of "your own investment strategy" are to the values above.
In contrast to the pension funds, "BVG-linked fund products" of the banks practically never achieve the gross returns of the Pictet indices.
The main reason for this are the mostly very high product costs (cf. TER=Total Expense Ratio in the factsheet), which can devour up to one third of
the return, especially for more conservative risk profiles.
Accordingly, it is our endeavor to bring the return of endowment assets and private retirement assets by means of:
a clearly defined investment strategy
Attractive and, in particular, transparent fee models
as well as customer-oriented advice
closer to the performance of the Pictet BVG indices. If you wish, we can analyze your current asset allocation and fee structure and make suggestions for investment improvements.
In addition, we will gladly take over the cost negotiations with your custodian bank.