AP3 Returns 10.3% in 2024, Assets Rise to $51.8B

The Third Swedish National Pension Fund, AP3, announced Tuesday that it achieved a 10.3% return, net of expenses, in 2024, largely driven by equity returns. The fund’s assets rose to 549.1 billion Swedish kronor ($51.8 billion) at the end of the year.

In the past five- and 10-year periods, the fund has posted annualized returns of 8.2% and 8.4%, respectively. The fund allocates 36% of its portfolio to global equity, 29% to alternative investments, 22% to fixed income and 13% to domestic Swedish equities.

Before costs, the fund returned 10.4%, of which equities returned 17.4%, fixed income returned 2.2% and alternative investments returned 0.8%. Expenses and fees cost the fund one basis point from net returns.

Additionally, the fund confirmed its return to investing in emerging markets in 2024, after a hiatus in 2022 and 2023, which the fund attributed to geopolitical uncertainties in emerging regions, including the war in Ukraine and the growing presence of authoritarian regimes. The fund plans to continue to invest in emerging markets in 2025.

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Approximately 38% of the fund is invested in North America, 33% in Sweden, 12.2% in the rest of Europe, 5.7% in the Asia-Pacific region and just 1.1% in emerging markets.

AP3, in its investment risk monitoring, began in 2024 to consider a country’s governance and factors such as democratic development, rule of law and corruption risk in its analysis.

AP3 is one of five buffer funds which manage assets on behalf of the Swedish state pension system. The Swedish government is in talks with the funds to consolidate AP1, AP3 and AP4 into a single fund by January 1, 2026.

“It is now up to AP3, in partnership with the other funds, to carry this out with the best outcome for the pension system,” said Staffan Hansén, AP3’s CEO, in a statement.