Savings Policies Show Mixed September Results; Altshuler, Ayalon Lag
Translated & summarized from N12 by baba
September saw mixed results for Israeli savings policies, with general tracks nearly flat and stock tracks up 0.6%, aided by a 2.5% Shekel depreciation against the dollar. Hachshara Mitav led September's general track, while Clal Insurance leads year-to-date and over 12 months. Stock policies also saw Clal Insurance leading long-term, though Ayalon leads three-year returns in both tracks. Management fees remain a significant cost for these policies.
The story in 6 lines · by baba
- September savings policy returns were mixed, with general tracks flat and stock tracks up 0.6%.
- The Israeli Shekel's 2.5% depreciation against the dollar boosted foreign investments for savers.
- Hachshara Mitav led September's general track performance, while Altshuler Shaham lagged.
- Clal Insurance leads year-to-date and 12-month returns for general and stock savings policies.
- Ayalon leads three-year returns in both general and stock savings policy tracks.
- Savings policies, unlike investment provident funds, have higher management fees up to 2%.
September proved to be a mixed month for Israeli savers, with general savings policies showing minimal change and stock-focused policies gaining an average of approximately 0.6%. The Israeli Shekel weakened by about 2.5% against the US dollar, boosting the value of foreign investments, while the bond market experienced a downturn due to rising yields in both Israel and the US, negatively impacting bond prices.
In the general track, which holds the majority of savings, Hachshara Mitav led in September with a 0.35% return, followed by Hachshara Hachshara at 0.33%. At the bottom of the general track performance were Ayalon with a -0.10% return and Altshuler Shaham with -0.42%, the latter being affected by its exposure to long-term bonds.
For the year-to-date, Clal Insurance leads the general track with an 8.3% return, and in the last 12 months, Clal also leads with 13%. Ayalon, despite its September dip, ranks high in longer-term performance, leading the three-year returns with 46.6%.
In stock-focused policies, Hachshara Hachshara and Hachshara Mitav tied for first place in September with 1.14% returns. For the year-to-date, Clal Insurance leads with 14.6%, and over the past 12 months, Clal also leads with 22.7%. Ayalon leads the three-year returns for stock policies with 79.1%.
Savings policies, also known as financial policies, are investment vehicles managed by insurance companies. They allow for flexible deposits and withdrawals without annual limits, and switching between investment tracks is tax-deferred. A key drawback is management fees, which can reach up to 2% annually, compared to a 1.05% cap for investment provident funds.
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