Craft baker comparisonTo compare the prices of craft bakers is a near impossible feat, so we have looked at the mean price of various key items to see how prices have changed on average in the last year.The price of a large white loaf has dipped from £1.40 to £1.30, while a large wholemeal loaf has fallen from £1.48 to £1.35.Jam doughnuts have increased in price on average from 53p to 55p. A chicken sandwich has also dropped from £1.95 to £1.73, while a standard-sized sausage roll has remained the same price on average, at 78p. A packet of Walker’s Crisps has risen significantly from 41p to 55p, while a regular coffee has fallen in price from £1.01 to 85p.The coffee chainsCoffee shop pricing has remained largely static since January 2009, with only small fluctuations in prices across the top four chains Costa Coffee, Coffee Republic, Caffè Nero and Starbucks.Focusing on take-away prices, the price of a regular cappuccino fell by 10p at Coffee Republic between January and March ’09 to £2.30. Starbucks has upped the cost by 5p, Costa is still charging the same, whereas a cappuccino in Caffè Nero has fluctuated from £1.95 to £2.10 and is now £2.The price of a blueberry muffin has fallen from £1.70 at Coffee Republic in Jan ’09 and £1.45 at the other chains, to £1.40 at Coffee Republic and Starbucks and £1.50 at Caffè Nero.Caffè Nero has dropped the price of its plain croissants from £1.20 to £1.10, while Costa increased its price to £1.25 in March 2009, and then brought it back down to £1.15. A chicken salad sandwich at Coffee Republic has increased by 10p to £2.95 and by 15p in Starbucks to £3.30. Nero has dropped its price by 15p to £3 and Costa by 5p to £3.05.Supermarket prices The price of a Warburtons Toastie (800g) has remained relatively stable, selling for £1.29 across Tesco, Sainsbury’s, Morrisons and Asda for most of 2009. Its price dropped in Sainsbury’s and Tesco to £1.24 in March and May ’09 respectively.Despite a price spike mid-year, Kingsmill’s Great Everyday loaf (800g) remained at £1.22 across the major supermarkets for 2009. In July, the price crept up to £1.33 in Morrisons, Tesco, Asda and Waitrose, whereas in Sainsbury’s it went up to £1.39. By February 2010, it had fallen across the board to £1.19 in Sainsbury’s, Morrisons and Waitrose and £1.14 in Tesco and Asda.Hovis wholemeal medium sliced (800g) was £1.24 across the big five in March 2009. It dropped to £1.22 in Morrisons in July, before going back to £1.24 in August. It was available in Tesco for £1.14 in November, and £1.22 in Asda in the same month. By February 2010, it had fallen in price to £1.22 in Tesco and £1.19 in the other supermarkets.Since it was first tracked in August last year, a 400g pack of McVitie’s Milk Chocolate Diges-tives fell by a few pence at Tesco, Morrisons and Waitrose. But from February 2010 the cost is up across the board to £1.39 in Tesco, Asda and Morrisons, £1.37 in Waitrose, but has dropped 2p in Sainsbury’s to £1.24.
Sweden’s default premium pension fund AP7 plans to add emerging markets and small cap investments into its giant equities portfolio to increase diversification.In an interview with IPE, Ingrid Albinsson, CIO of the SEK370bn (€39.2bn) pension fund, said: “What will try to do going forward is to get some more diversification into the equities portfolio. “We haven’t decided exactly how and when, but we will try to get more emerging markets and we will try to get bit more small cap exposure into the portfolio.”Unlike the other large AP national pension funds in the Swedish system, AP7 is not a buffer fund to back up the state pension. It instead runs the default option within the Premium Pension System (PPM). The PPM is the part of the state pension that allows individuals freedom to choose their own investment providers and funds. “Because we have a lot of large caps and medium-sized stocks in the portfolio, we think we would be able to get some diversification by adding small caps as well, but at the end of the day, you always have to look to see whether the practice is as the same as the theory,” Albinsson said.The pension fund’s inhouse investment team will look into the reality of implementing this diversification strategy.AP7 is also to consider the use of risk factors, Albinsson said: “It is something that could diversify the portfolio more [but] we haven’t decided exactly when and how we will do this.”The CIO added: “The aim of the diversification exercise is to create a more efficient portfolio, which will create more value for the risk we take.“When the pension product was first created, there was a lot of simplification, but in the meantime, markets have changed, techniques have changed — and we have changed. It is possible now to develop our product by diversifying our portfolio and getting more efficiency.”The organisation’s overall investments have remained largely unchanged over the past few years in terms of their asset allocation.AP7 runs two funds which act as building blocks for its Såfa default premium pension product — an SEK257bn equities fund and an SEK112bn bond fund.Proposals to reform the PPM currently under consideration in Sweden could result in AP7’s assets under management more than doubling in a few years’ time.Under the new plan, the consultation for which closed this month, individual PPM savers would be required to re-evaluate their fund choice every seven years, with their savings being transferred to AP7 if they fail to express a choice.If the ideas become law, the resulting extra business will serve to make AP7 more efficient, Albinsson said: “Economies of scale really do matter in the financial sector. It’s a clear advantage if you really have size.”At the moment AP7 has a staff of 25, based in the Swedish capital, Stockholm. Albinsson said the company would “probably” look to hire more staff if its asset base was to double in size.However, the balance of in-house and outsourced asset management was unlikely to change, she said. Some 30% of AP7’s assets are managed in-house, and 70% outside.“We think it’s appropriate for us to have that, because we have a lot of beta in the portfolio, so that is best outsourced in order to get the economies of scale,” Albinsson said.AP7 was an early institutional mover in sustainable investment, and has used the twin tools of engagement as well as stock exclusions for longer than most of its investor peers. It was working on bringing in ‘green mandates’, Albinsson said, as the pension fund continued with its plan to move into the clean tech area which it started a few years ago.“At the same time, we’re not in a hurry to do this, because to get value out of this kind of investment, it takes time. We have been having a very active discussion, with targets of increasing our exposure especially in climate investments, but for us its more of a gradual increase,” Albinsson said.