In the investment profiles in PFA Climate Plus, the risk is gradually reduced as retirement approaches. This
is illustrated in the figure and table, which show the risk value of the four profiles depending on the
number of years until retirement. In terms of risk, CustomerCapital is placed with 5 % in Global Equity.
Read more about CustomerCapital and see your
exact share of CustomerCapital at My
Updated Oct. 31, 2022.
Risk values between 5.0 and 6.0 represent the highest risk. Here, your savings may fluctuate significantly
from one year to the next.
Risk values between 1.0 and 1.9 represent the lowest risk. Here, fluctuations will generally be less
Once you have found the risk value, you can see here
how much the savings may fluctuate throughout a year (link to Insurance & Pension Denmark's website, in
Insurance & Pension Denmark calculates benchmarks for respectively low, medium and high risk for display in their benchmarking tool. The Benchmarks will be recalculated every year.
Benchmark is calculated as a simple unweighted average of the risk scores. All pension companies with life cycle products are included in the calculation.
The benchmarks are included in the graph above.
Please find the method description at Insurance & Pension Denmark's website
Profile risk classification
Based on Insurance & Pension Denmark’s risk bands, the profiles are risk classified with these
Profile A: Low risk
Profile B: Low risk
Profile C: Medium risk
Profile D: High risk
Short-term and long-term risk
Pension savings entail two types of risk. The short-term risk illustrates how much the value of your savings
may fluctuate during the next year. And the long-term risk illustrates the level of uncertainty related to
your future payouts when you retire.
The risk value is only an expression of the short-term risk – i.e. how much the value of your savings
may fluctuate during the next year.
The risk depends on your age
When the risk is high, the return expectations are also high. Therefore, most pension plans entail a high
risk while the customer is young. While the customer is young, there is time to regain any losses sustained
during years with negative developments on the financial markets.
When the customer gets older, there is less time to regain any losses sustained. Thus, most pension plans
gradually reduce the risk as the customer gets older.