In the past year, their yields have fallen faster than that of conventional euro funds. A way to limit collection?
The glass half empty or the glass half full. This is the feeling when reading the 2019 balance sheet of real estate funds, these life insurance supports which offer the same guarantees as conventional euros funds while leaving hope for better performance thanks to their more typical asset allocation ” immovable “.
Admittedly, according to figures from Good Value for Money, we can note that with an average return of 1.78%, funds in real estate euros once again outperformed funds in traditional euros (1.4%).
An advance that is gradually reducing
However, these figures are not entirely convincing. Indeed, the fall in funds in real estate euros is heavy compared to 2018 (-0.55 point), much heavier in any case than that of traditional euro funds (-0.27 point). In addition, the excess performance compared to conventional euro funds (+0.38 points) is the lowest ever recorded. Since the mid-2000s, it has averaged 0.80 points, even exceeding 1 point in some years.
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Can we explain this tightening by lower real estate yields? This cannot be excluded. But Good Value for Money believes that this argument ” does not in itself explain the importance of the drop observed ”
An expensive product for insurers
The firm specializing in the analysis of the life insurance market points out in particular that real estate funds in euros have a very high cost for insurers from the point of view of prudential Solvency II standards. In short, professionals have every interest in curbing collection in this segment. Limitations already exist such as the minimum payment requirement in units of account or the cap on annual investment (for example at 50,000 euros).
That said, Good Value for Money notes that there are other ways to deter investors. ” One of the ways is obviously to lower the rates served “, Launches the cabinet.