Insured members benefit from strong pension fund performance
Swiss pension funds generated a return of 6.3% last year. This positive result enabled an average interest credit of 4.3% and allowed the funding ratio to rise to 114.4%. The bond allocation reached a new low, while equities made up the largest share of the investment portfolio for the second consecutive year. Despite ongoing uncertainty, Swiss pension institutions have also recorded above average returns in the first eight months of 2026.
The full study can be found here:
Strong Returns and Record Interest Credits
Thanks to positive developments in financial markets, Swiss pension funds achieved an encouraging average return of 6.3% in 2025. This clearly exceeds the average annual return of 3.6% recorded over the past two decades. Converted to the total assets managed under the second pillar, this corresponds to an investment gain of CHF 77 billion (second pillar assets of CHF 1,220 billion, according to the 2024 Federal Statistical Office pension fund statistics). Insured persons also felt the benefit of these strong returns: their balances were credited with interest of 4.3% on average, the highest level in the past 25 years.
Returns achieved by Swiss pension funds (2006 to August 2026)
Equity Allocation Rises
For many years, fixed income investments were the most significant asset class for Swiss pension institutions. At the outset of the Risiko Check-up study more than 30 years ago, nearly every second franc was invested in bonds. Since then, this share has steadily declined and reached a historic low of 29.3% in 2025. Pension funds reduced their investments in global government bonds due to rising sovereign debt levels and higher hedging costs. The freed up capital was partly reinvested in Swiss franc bonds and global corporate bonds. For the second year in a row, equities were the largest asset class, currently accounting for 34.1% of the portfolio. The shares of real estate (22.6%, +0.1%) and alternative investments (9.8%, minus 0.3%) changed only marginally compared to the previous year.
Changes in asset allocation of Swiss pension funds (2006 to 2025)
Infrastructure Dominates Alternative Investments
84% of pension funds invest in alternative investments. The share of alternative investments in the total allocation has hovered around the 10% mark for roughly ten years. However, the mix within alternative investments has changed over this period. While hedge funds used to dominate, infrastructure investments now represent the largest share at 2.8% of total assets, or 28% of alternative investments, followed by private equity at 2.4%, or 24% respectively.
Rise in the Share of Illiquid Investments
The share of illiquid investments (for example real estate, mortgages and alternative investments) rose from 28.2% to 35.7% over the past 15 years. This increase was driven by the low interest rate environment of the 2010s and the search for new sources of return and diversification. The further expansion of illiquid investments currently focuses mainly on Swiss real estate and infrastructure investments. 31% of respondents indicated they intend to increase their allocation to Swiss real estate. For infrastructure investments, 28% plan a further expansion. Whether this will result in a rising illiquidity ratio overall remains to be seen: the survey also shows that 21% of respondents intend to reduce their exposure to foreign real estate, for example.
Strategic investment intentions for illiquid asset classes among Swiss pension funds
Current Situation
Pension funds started 2026 with a funding ratio of 114.4%. Despite volatile market conditions, they recorded a return of 5.0% by the end of August, together with a rise in the funding ratio to 118.5%. Thanks to existing reserves and broad diversification across the investment portfolio, the second pillar currently finds itself in a solid financial position. Provided financial markets do not experience a significant downturn in the remaining months of the year, insured persons can expect good interest credits on their pension fund balances again in 2026. Some pension recipients may then also look forward to an additional boost from their pension fund, alongside the 13th AHV payment.
About the Study
The pension fund study "Risiko Check-up" was conducted for the 32nd time in 2026. As the oldest and largest independent pension fund study in Switzerland, it provides a consistently representative picture of the second pillar and delivers valuable insights, trends and long term comparisons for pension institutions and their stakeholders. The study management publishes key findings each May and presents the full evaluation along with a special topic each September. The study is based on data from 469 pension funds with assets totaling CHF 1,009 billion (a new participation record), covering around 80% of total pension fund assets. In addition, 212 pension funds responded to questions on this year's special topic of illiquid investments and illiquidity risks.
About Complementa
Complementa has been supporting pension funds for more than 40 years on matters of financial and organizational management and assists them throughout every phase of the investment process. As an independent partner, Complementa creates transparency and provides the foundation for well informed decisions, contributing to strong governance. The company relies on proven expertise, long standing experience and high performing analysis and reporting solutions. www.complementa.ch
More information from Oliver Gmünder, Ueli Sutter, Andreas Rothacher, Complementa AG, Eisengasse 16, 8008 Zürich, +41 (0) 44 368 30 90, riskcheckup@complementa.ch.
Comments