AkademikerPension's AlfaPension, its flagship lifecycle product, has reported a negative return of -0.9 per cent in the first half of 2025 for members with medium risk and more than 15 years to retirement.

Across all risk and age profiles, the half-year return ranged from +0.9 per cent to -1.5 per cent.

The firm stated that the primary reason for the negative returns was a "sharp decline" in the US dollar, which negatively impacted the return when calculated in Danish kroner.

It noted that the average interest rate product was less affected by developments in the dollar, and ended Q1 with a positive return of 0.2 per cent.

AkademikerPension investment director, Anders Schelde, said it had been a "challenging" half-year, where an "unpredictable" Trump had dominated the media, as well as the financial markets.

"Consciously or unconsciously, Trump has sent the dollar to the floor, but fortunately, we hedge much of our exchange rate risk, but not enough to protect ourselves 100 per cent," he added.

Trump's early tariff policy announcements created significant uncertainty in global stock markets in the spring, and the US stock market fell by over 20 per cent in mid-April but recovered, ending the first half of the year around five per cent higher than it had been at the beginning of the year.

"In turbulent financial markets, there will always be fluctuations, and even the best product can have a difficult period," continued Schelde.

"Rather than doing like the others, we keep our focus on doing what we think is right in the long run, and if you look at our ten-year return, we are still at the top - even when you take into account the weak return of the past year," he explained.

Indeed, AkademikerPension hedges a large part of the currency risk, and the firm stated that this contributed to a positive return of almost five billion kroner in the first half of the year; however, it was not sufficient to completely offset the total currency loss.

"We actually increased our hedging of the dollar during the first half of the year, but our low returns indicate that we are still hedging less than our industry colleagues, but if you are a long-term investor, you should actually not hedge too much, as it costs you the return," Schelde claimed.

"I think it is a good example of how the short and long term are connected, and as a long-term pension investor, the long term is crucial for us", he added.

Looking ahead, he said there would "certainly" be further fluctuations, but it was difficult to predict what would happen.

"Investors are learning that you should not take everything Trump says at face value, and we can certainly end the year with a nice positive return if Trump does not make too much noise.

"So it calls for an active investment approach, where you closely monitor the situation and try to navigate these fluctuations as best as possible," he concluded.

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