The youngest universal pension fund DallBogg: Life and Health with its 10,08% rate of return for 2023

The youngest universal pension fund DallBogg: Life and Health with its 10,08% rate of return for 2023

Larisa Borisova – Head of the Specialized Internal Control Service. Master in Accounting and Control. She reports directly to the Board of Directors. Ms. Borisova is a recognized expert with over ten years of experience in the pension industry and many years of experience in accounting, investment brokerage, finance and financial analysis.

The world is different today – full of threats, risks and opportunities
European communities face recession, a major war on the eastern frontiers, ageing populations, strong migration waves, rising poverty levels and persistent social inequalities. Pension systems are, at the same time and predictably, facing increasing budget constraints and deficits. There are also many new opportunities to increase productivity, innovation and discovery in the service of a healthy, facilitated and long life. Quick and proper orientation are crucial. Against this backdrop, in a relatively stable and growing economy, pensions offer opportunities to manage our retirement funds and savings with heightened expectations.All Bulgarian universal pension funds have reported positive returns in various amounts over the past year –FSC’s data.

Achieved returns by universal pension funds (UPF) in 2023.

Our choices today determine whether we will live like “Western European pensioners” tomorrow: it is time to look around and park our pension money where it is safe, where it is profitable!

And indeed, with the enviable 10.08% return achieved on the funds in the individual accounts of the insured persons in the ‘DallBogg: Life and Health’ UPF in 2023, we can hope that the distance with the Western Europeans is shortening for now. It is important that in the future our small, highly motivated and cohesive team is able to realise and report such and higher results for a number of years. With growth rates of 7-10-12% over 15 years, to take just one macroeconomic example, China has become the second economy in the world – far ahead of Japan and Germany. So at a microeconomic level, year-on-year returns are a key measure of how well the monthly compulsory additional pension contributions have been managed. However, the big prize comes when this high level is sustained over years. We are dedicated to this goal with the task of maintaining confidence and our attractiveness.

POD ‘DallBogg: Life and Health’ is the newest pension provider in the country and has only been operating for two years. We manage risk and expect it, which is why we say ‘your money never sleeps’. We invest in the world’s financial markets, exactly by the rules, while day and night literally change. So our members’ pensions and savings “work” now for their future wellbeing. Trust and exercised choice oblige and motivate us in this intense analytical and complex activity. The only timely activity that financially enlightened retirement savers, before they reach retirement age and after they are assigned to a fund, should decisively do is: their informed choice! And then only to monitor long-term returns.

2023 – PAC DallBogg: Life and Health’s year

Already only two years old, the ‘DallBogg: Life and Health’ AMP has managed to overtake all incumbent funds and companies in the country, where no new pension fund had been licensed for a full 12 years before. For us, the achievement is a great encouragement and a great responsibility to our members and all those who enthusiastically trust us and transfer their pension accounts. The past year 2023 was tense and at the same time heady with its downs and ups in the financial markets. A number of large funds abroad changed their strategy abruptly. In individual cases, these changes were as confirmation or encouraging evidence of the right course we had chosen. Over the past year, the assets of universal pension funds in this country have been invested in legally permitted investment instruments, and only the most far-sighted have been able to make the most of favourable times for transactions. Above all, the expert capacity of the funds’ management – their efficient management of the investment portfolio – is crucial. The ‘DallBogg: Life and Health’ UPF was particularly successful and managed to achieve the highest return among universal pension funds in Bulgaria for the year. We provoked universal admiration among our members, great interest among prospective clients and high levels of approval among unbiased observers.

In the harsh struggle with the high volatility of prices of financial instruments, the DallBogg: Life and Health UPF managed to achieve an enviable 10.08% yield on the funds in the individual accounts of the insured persons, who believed even more strongly in our expertise and spontaneously attracted new members to the fund.

However, the Bulgarian pension system in terms of funds raised relative to GDP is very small and is far from the OECD proportions we aspire to. Despite the improvements made recently, it can and should generally provide a more dignified old age for its current and future pensioners.

We are overwhelmed by a constant quest for development

PAC DallBogg: Life & Health constantly strives to improve the performance of its teams by developing individual talent and nurturing leadership skills especially in investment decision making. Material incentives, strictly limited by law, are more often replaced here by fostering a culture of constantly seeking and sharing knowledge and striving for innovation. The overarching organizational goal of these efforts is to build well-structured pension funds with robust controls, efficient investment of assets, and increased financial awareness of our current and future insured. We have begun to cultivate a lasting interest in our members in today’s global and national capital markets in order to awaken their interest in improving their long-term financial health by saving smartly for a third retirement. They should not be surprised at the middle or end of their working career by the financial outcome of their years of effort and savings. We were very saddened by the unanimous finding made from the rostrum of Parliament these days that almost all households whose homes are subject to renovation are struggling to invest BGN 5-6 000 for the 20% self-financing of renovation. At the same time, BGN 73 billion of people’s money is sitting on almost interest-free deposits in banks while the third – savings – pillar of the country’s voluntary pension insurance is desperately weak and undervalued as a source of additional stability and a guarantee-insurance instrument. Financial markets are volatile, so an important quality is the foresight of our investment team. High professional ethics, expertise and dedication to our members’ interests and investment goals are our greatest virtues.

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A description of the significance of the achieved rate of return and investment risk indicators
Nominal return – this is the return achieved on the management of a fund’s assets. It is calculated by dividing the difference between the value per unit of the fund valid for the last business day of the relevant year and the value per unit of the fund valid for the last business day of the previous year by the value per unit valid for the last business day of the previous year.
Standard Deviation – is a statistical measure of the dispersion of the values of a random quantity about its average or expected value. Standard deviation is accepted as one of the main indicators for measuring the risk of an investment portfolio.
Sharpe Ratio – an indicator that compares the returns achieved from managing an investment portfolio and the risk taken to achieve those returns.
The methodology for calculating the achieved nominal return and the level of investment risk is in accordance with Annex 15 of the „Regulation № 61/ 27.09.2018 of the FSC.
The investment policies of the funds managed by „PAC DallBogg: Life & Health“ are available on the Company’s website –, section „Investments“.
A description of the significance of the achieved rate of return, the level of investment risk, the methodology for calculating and the investment policy of the fund are available on the Company’s website –, section „Investments“/ „Rate of return and risk“.