Insurance investment funds are flourishing - Cyprus Profile

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Articles | 10 February 2020

Insurance investment funds are flourishing

While deposit rates are hitting rock bottom, with some banks even applying negative interest rates on large deposits, Cyprus Insurance Investment Funds may offer investors a way out.

According to the latest figures provided by the Association of Insurance Companies, Insurance Investment Funds have taken off bringing in double-figure yields.

Based on the data for 2019, of the 10 largest insurance funds available to Cypriot investors, nine have positive returns and only one negative.

Ancoria Insurance’s Savings Fund tops the list with 14.14% yield, followed by Cyprialife’s Balanced (12.38%), Eurolife’s Mixed (11.76%), Cyprialife’s Cyprialife (11.26%) and Universal Growth (10.24%).

In comments to online site Stockwatch, Ancoria fund manager Stelios Petrides notes that 2019 was rich in events and included positive growth prospects for the global economy, indications that the US and China will come to at least a partial agreement, Brexit, and the continued relaxed monetary policy around the world.

“After the dramatic end of 2018, 2019 proved to be one of the best years in terms of stock and bond yields, reminding investors once again of the importance of diversification and investment discipline,” said Petrides.

The largest insurance fund is Eurolife’s Mixed Asset of €376.1 mln followed by Universal Life’s Growth of €97.3 mln.

Investment Funds’ yield performances are attributed to their exposure to stocks in foreign markets.

According to the data compiled by Stockwatch on the distribution of the funds’ portfolios, funds prefer to invest in foreign and domestic equity, while also including bonds and debt securities.

Equity and Balanced funds top the largest portfolio list, having large exposure to equities and other investment funds.

Universal’s Growth Fund has a 49.01% equity exposure, followed by Ancoria’s Savings Fund with 47.28% and Eurolife’s Balanced with 44.44%.

Regarding investments in bonds and securities, Cyprialife’s Secure tops the list with 72.6%, followed by the company’s Balanced fund.

Source: Financial Mirror

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