Pensionskasse Manor (Manor) is the €1.8bn pension fund for the family-owned Swiss supermarket chain Manor. It caters for 9,400 current and former workers through a hybrid defined benefit and defined contribution model.

In 2022, it lost 5% but this followed a 10.9% return in 2021 and 6.8% gain the year before. However, over the past 10 years,  Manor has generated an average annual investment return of 5.1%, while its three- and five-year average annual returns are just over 4%.

Manor pursues a long-term investment strategy that it compares with US endowment funds more than other pension plans. This means it has a much lower allocation to fixed income than many other Swiss retirement plans and a much higher proportion invested in alternative assets such as hedge funds, private equity and infrastructure. More than 30% of the fund’s strategic asset allocation is dedicated to local and foreign real estate.

This allocation has led to strong investment performance and a high coverage ratio. At the end of 2022 Pensionskasse Manor ranked in the top 10% of Swiss funds with a coverage ratio of 123.9%, demonstrating that assets comfortably exceeded liabilities. This allowed the pension fund to increase benefits in payment by 2% for 2023. Over the past five years the pension fund has been able to provide an annual interest payment of just over 3% on average, despite the negative interest rate environment in Switzerland.

Pensionskasse Manor is planning a new asset-liability management study with the aim of repositioning its strategic asset allocation to be more appropriate for the expected future investment environment. This will potentially lead to an increase in fixed income allocations given higher yields available.