Danish pension company Sampension returned 9.8 per cent for an average customer with 15 years left until retirement, its annual results have revealed.

During the year, Sampension returned 11.7 per cent on its equity investments and 7.7 per cent on its bond investments.

Its average annual return over the past five years was 8.1 per cent a year.

The pension company stated that the end of 2023 offered surprises, with the returns on pension savings having a “final spurt” towards the end of the year.

Last year’s returns were a recovery from the negative returns in 2022, while inflation was historically high and interest rates were on the rise a year ago.

Sampension deputy investment director, Jesper Nørgaard, explained that Sampension’s expectations for the 2023 investment year were therefore “very cautious”.

“We were hoping for positive – but low – returns and could still feel the very negative rates from 2022,” he stated. “But fortunately, it is not always that one's concerns are met.”

Sampension noted that, looking to 2024, there were several factors and events that will impact the financial markets.

The pension company pointed to the US presidential election in November, and the ongoing wars in Ukraine and the Middle East.

Furthermore, it highlighted expectations that central banks will lower interest rates, but that inflation was still a little too high, and that economic growth in Europe is low and several countries were in recession by the end of 2023.

"Unfortunately, uncertainty is still high, and it is incredibly difficult to predict the possibilities for creating high returns,” Nørgaard said.

“Fortunately, pensions are long term - and there is room for both good and less good years."

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