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26 May, 2020

Information Note – Covid-19’s effect on the pension funds and their partial recovery

  • As we have always asserted, and as has been demonstrated in previous crises, decreases in the value of funds do not necessarily entail losses, which will only be effective for those who must sell their pension assets, those who are in more conservative funds with lower volatility, and those who react hastily to the crisis by switching from funds with higher risk levels.

 

  • This is demonstrated, once again, by the recovery in the value of the pension funds after their sharp decline in March. The value of the pension funds in April rose to USD 517,608 million, an increase of 4.4% over the March value, and a loss in value of 1.3% compared to last November. So, the pension funds have recovered USD 21,598 million of the USD 28,208 million devaluation initially observed.

 

  • Without minimizing or denying the extent of this crisis and the uncertainty of its duration, we must be confident that through the pension funds, members will continue to own their safest assets, whose value should recover when the crisis is over, as occurred in previous crises.

 

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