The Fund's asset allocation, in other words the proportion of equities in relation to fixed income assets and other asset classes such as real estate, is estimated to produce 80%–90% of total return in the long run. The Fund invests significant resources in creating optimal asset allocation.
The investment horizon for pension capital is very long; the Fund makes analyses of up to 40 years.
To optimise asset allocation over different investment horizons, the analysis is broken down into a number of different ones. This annual report describes three investment horizons. Different investment horizons enable the Fund to better capitalise on the opportunities and manage the limitations inherent in long-term (40 years), medium-term (3–5 years) and short-term analyses. For each investment horizon, the Fund determines an optimal asset portfolio.