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Average large North American public pension fund allocates 5.7% to hedge funds in FY2011 says Infovest21

Wednesday, October 26, 2011
Opalesque Industry Update - In its just-released Special Research Report, Infovest21 finds that the average large public pension fund which allocates at least $1 billion to hedge funds and funds of funds, allocates 5.7% to hedge funds and absolute returns funds in FY2011, an increase from 5.4% in FY2010 and 4.5% in FY2009.

Average Asset Allocation of 25 Large Public Pension Funds (%)

 

 

Equity

Bonds

Absolute Return/ Hedge Fund

Other Alternative Investments

Private Equity

Real Estate

Cash/ Short Term

Other

2011

48.2

22.4

5.7

3.9

5.8

8.2

1.1

5.1

2010

46.6

23.9

5.4

3.2

5.7

7.7

1.7

5.2

2009

47.5

23.4

4.5

2.7

5.5

8.4

2.5

5.0


The table above, which shows aggregated results for the past three fiscal years, highlights that the average allocation to equities increased to 48.2% in FY2011 from 46.6% in the prior year. However, the average allocation to fixed income declined from 23.9% in FY2010 to 22.4% in FY2011, notes Lois Peltz, President of Infovest21.

Private equity increased slightly from 5.5% in FY2010 to 5.8% in FY2011. Real estateexposure dropped from 8.4% in FY2009 to 8.2% in FY2011. Other alternatives increased from 2.7% in FY2009 to 3.9% in FY2011.

In compiling these results, Infovest21 tracked the asset allocation trends for 25 large public pension funds as far back as annual results were provided. Of those, 22 were based in the US and three were based in Canada. The sampling includes those pensions that allocate at least $1 billion in assets to hedge funds/funds of funds and publish their asset allocation on at least an annual basis. These findings make up Part 1 of the special research report.

Part 2 includes asset allocation findings of another 18 US pension plans whose allocations to hedge funds are under $1 billion.

For additional information, contact: general@infovest21.com

(press release)


BG

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