The pension fund incurred a 2.2% loss on its currency hedge, which had initially fully covered the risk on its dollar, sterling and yen-denominated bonds as well as 50% of its equity holdings nominated in dollars and sterling.As part of new investment policy, however, it decided to limit the currency hedge to American and British holdings representing more than 2.5% of its entire assets in December.Last year, the asset owner increased its risk profile aimed at an inflation compensation of at least 75%. It raised its strategic securities allocation from 44% to 50%, while reducing its fixed income holdings from 56% to 50%. At the same time, it introduced dedicated portfolios for returns and liabilities.Ahold Delhaize Pensioen said that equity, property and high yield bonds were the best returning asset classes last year, with yields of 27.4%, 22.3% and 17.2%, respectively.Emerging market debt, worldwide credit and alternatives gained 14.8%, 14.3% and 17.1%, respectively.The pension fund said that, as part of its current crisis management in dealing with the COVID-19 pandemic, it is assessing the options of hiring temporary workers to replace own staff falling ill.Eric Huizing, the scheme’s executive trustee for investments, said the board had decided to stick to its strategic asset allocation at the start of this month, despite exceeding the set bandwidth of 2.5%.However, he declined to provide details, explaining that the necessary rebalancing process hadn’t been completed yet.Ahold Delhaize Pensioen reported asset management costs of 0.23% and transaction costs of 0.14%.It explained that a 8bps rise of the latter relative to the previous year, was due to portfolio adjustments in the wake of an increased risk profile.The scheme has 35,365 active participants, 42,770 deferred members and 11,865 pensioners. At the end of February, its funding stood at 107.2%. Ahold Delhaize Pensioen, the €5.6bn Dutch pension fund of the Dutch-Belgian supermarket chain, saw its funding position deteriorate last year, despite a return of 22.6%.Its 2019 annual report said its funding ratio had declined by 1.7 percentage points to 107.9% as a consequence of continuously falling interest rates, the criterion for discounting liabilities.However, it said the slump in interest rates had also contributed to the fund’s annual result, predominantly through the 43% gain of its 28% holdings of government bonds and interest rate swaps as a hedge for its liabilities.The scheme said that, as part of its dynamic hedging policy, it had reduced its interest cover from 60% to 50% in August, when the 20-year swap curve had dropped to less than 0.75%.