Benefit from maximum security while reaping the rewards of capital market performance with the Vodafone Pension Plan.
Vodafone invests all contributions in the capital markets for you. Whether you are after security, a balanced investment or growth, you can decide the investment strategy for your pension. You can also change the strategy every month if you wish.
Investment market value – current status
Equity Fund: 1,855.94 €
Bond Fund: 17.14 €
Status as of 2024-10-07
The funds
We invest your contributions every month into one or more of the following funds:
The Vodafone Equity Fund, the Vodafone Bond Fund and an enhanced cash fund.
Both, Vodafone Equity Fund and Vodafone Bond Fund, are funds of funds which act as an umbrella for a number of underlying investment funds (pooled funds). The money invested in the Vodafone funds is used to purchase shares in the underlying investment funds according to an asset allocation agreed by the investment committee of the Vodafone Pension Trust. The amount that can be invested in the Vodafone funds every month depends on the size of the contributions and each fund’s current purchase price.
What you need to know:
All you need to do is decide on the investment strategy. Everything else is done automatically. By choosing an investment strategy, you decide how you want your investment split between the Vodafone Equity Fund and the Vodafone Bond Fund. The growth strategy is heavily weighted towards the equity fund, whereas the security strategy focuses on the bond fund. The balance strategy falls somewhere in between.
Fund structure
The ‘Vodafone Equity Fund’ and ‘Vodafone Bond Fund’ are both funds of underlying pooled funds. Each Vodafone fund has an investment advisor and its own investment strategy. As the funds are diversified across a number of managers, the impact of an individual manager’s performance, either positive or negative, is limited. If Vodafone is dissatisfied with a particular manager, there is the option to exchange the fund with an alternative.
Investment experts select, evaluate and regularly review the funds and their managers in partnership with Vodafone.
Security with the life cycle model
There are two mechanisms that determine the allocation of Vodafone Pension Plan contributions to the Vodafone Equity Fund and the Vodafone Bond Fund: Your investment strategy, where you choose between growth, balance or security, and the life cycle model underlying each of these investment strategies. This model defines exactly what weighting is given to each of the two funds at each age. The principle is that the younger you are, the higher your share of investment in the growth-oriented Vodafone Equity Fund.
Risk/reward ratio
The equities underlying the funds are expected to produce a sound return over time. However, return inevitably entails risk. For this reason, there are two mechanisms that help mitigate your exposure towards this risk. Firstly, investing in a diversified fund of funds helps protect the performance against poor performance of an individual manager. Secondly, Vodafone guarantees all contributions to your Vodafone Pension Plan. This means that you will never come out with less than what you and Vodafone have paid into your pension. Should the worst happen when it comes to paying out your pension, Vodafone will have to make up any difference between the funds’ value and the total of all contributions. So, you can invest knowing you have a safety net.
How funds are organised
Vodafone Equity Fund
The Vodafone Equity Fund comprises various underlying pooled funds.
The majority of them are actively managed and benchmarked against global indices. The remaining funds are passively managed index funds, emerging markets equities and shares in listed property and infrastructure.
Vodafone Bond Fund
The Vodafone Bond Fund pursues a very broad investment strategy with a larger number of underlying pooled. European government and corporate bonds make up the majority of the investments. The remainder is made up of smaller investments across global corporate bonds, European business lending, global high-yield bonds, emerging markets bonds, global government bonds and European property funds.
A life cycle model is an investment strategy where your contributions are allocated to bond and equity funds according to your attained age. With this model, opportunities for higher returns are pursued in younger years before shifting focus to more conservative investments at higher ages. You do not have to make any decisions yourself. The model ensures that the allocation is adjusted automatically every year.
The basic principle behind this is that young employees first have to build capital for their pension and can absorb capital market risks more easily due to the long time period left until their investment matures. Older employees, on the other hand, need to protect their saved capital against a loss in value. The idea here is to steadily increase protection for the accumulated capital as you get closer to retirement.
Investment strategies
You decide how much focus to put on returns when you invest your pension money. You have a choice of three investment strategies. The more focus your strategy has on returns, the greater the share of equity funds. However, the life cycle model underlies all strategies, which means that the share of equities is always higher during your younger years.
It is not possible to predict how your pension will grow under each strategy. Nevertheless, you cannot make any wrong choice because we take care of the following:
Carefully selected funds of funds
Life cycle investment
Contribution guarantee
Growth
This is the investment strategy that focuses most on return opportunities. The Vodafone Equity Fund plays the most important role for this, representing 100 per cent of your investment until age 45. The allocation to the Vodafone Equity Fund will slowly decrease from then on. Despite this, it makes up a higher proportion of your investment than in the other investment strategies. The growth investment strategy offers the greatest opportunities, although a high level of volatility is possible.
The aim of this investment strategy is to find an even balance between capital market rewards and risks. With this strategy, the Vodafone Bond Fund play a larger role than with the growth strategy. Even so, the Vodafone Equity Fund still makes up a significant allocation, especially for younger employees.
This investment strategy is structured with the least focus on growth and, as such, relies most strongly on the Vodafone Bond Fund. This strategy still allocates a portion of your investment into the Vodafone Equity Fund so that you have a positive expected return.
No matter what happens, your pension is secure. Vodafone is required by law to guarantee you the total of all contributions that have ever been paid into your pension plan. So, regardless of the investment strategy you choose, you will not lose your contributions.
Decide for yourself and stay flexible
The Vodafone Pension Plan gives you lots of room to make your own decisions, with the result that you can flexibly adjust your pension to your needs at any time.
Choosing the investment strategy
You can change your investment strategy every month if you wish. Choose yours based on your personal preference and financial situation. How much of a risk-taker are you? Would you lose sleep if you had too many shares?
You should take a moment now and then to check if you are still happy with your investment strategy. If not, change it. Apart from that, it cannot do any harm to combine the Vodafone Pension Plan with your private preparations for retirement. Is your overall financial position balanced?
Changing the investment strategy
To change investment strategy, just select the strategy you desire and click ‘Change investment strategy’. Your capital will then be invested in line with your new strategy as of the following month. You can choose two different strategies for monthly contributions and one-off payments.
Make sure you enter your changes on time before you receive each new salary payment. You will find an overview of the current cut-off dates below.
Important dates
Please observe the cut-off date for each month when choosing an investment strategy.
The general rule is that all decisions must be made before your monthly salary is paid or the relevant one-time payments are made. These cut-off dates are generally in the first week of the month – though you can record your decision online on the portal at any time. What does that mean? If you are certain at the beginning of the year that you want your next Christmas bonus to be paid into your Vodafone Pension Plan, you can record this decision months in advance.
