2025 was a year in which financial markets moved in all directions. Trade conflicts, geopolitical tensions and concerns about the global economy created uncertainty. In the spring, equities were hit hard, with declines of more than 16%. Markets recovered later in the year, but uncertainty remained.

Despite this turbulence, the economy proved resilient. Growth remained moderate, inflation stabilised and central banks lowered interest rates. It was not a calm year, but the economy did not come under further pressure either.

For SSPF, this resulted in an investment return that may seem disappointing at first glance: the fund recorded a total return of -4,2% over the year. At the same time, this result was better than the benchmark of -5.9%. However, even this does not tell the full story.

The fund’s investment portfolio broadly consists of two parts: a defensive portfolio and a return-seeking portfolio.

The defensive portfolio is designed to reduce risks and protect pensions against interest rate fluctuations. This portfolio recorded a negative return of -10.0%, mainly due to rising interest rates. While this may seem counterintuitive, it reflects how the strategy is intended to work. SSPF deliberately protects itself against major interest rate movements. As a result, when interest rates rise, not only do some investments decrease in value, but the amount of money needed to pay future pensions also declines. In 2025, this second effect was greater and contributed positively to the increase in the funding ratio, from around 129% at the end of 2024 to nearly 136% at the end of 2025.

The second part of the portfolio is focused on generating returns, with investments such as equities. This portfolio performed strongly, achieving a return of 5.8%, mainly driven by the continued strength of technology companies. However, there were significant differences within this portfolio. Real estate underperformed. The stronger euro also reduced returns on US investments.

These results reflect SSPF’s investment strategy. With a relatively large number of retirees, the fund deliberately prioritises stability and risk management. The goal is not to achieve the highest possible returns in strong market years, but to maintain a stable financial position that can also withstand less favourable conditions.

In short:
A year marked by volatility and uncertainty in the markets, but one in which the pension fund became financially stronger overall.