The board of CalSTRS, the second biggest fund in the US, has
three broad research initiatives for the investment team this year: rethinking active versus passive and the mix of internal and external management; commodities; and liability – driven investments. Chief investment officer, Chris Ailman, spoke to Amanda White.
The UK Treasury has taken aim at the European Union directive to impose equivalence tests upon foreign alternatives managers, urging institutional investors to join the debate – and for managers to curb inflammatory remarks and stick to the argument at hand.
With two more UK pension funds announcing arrangements to hedge their pensioner liabilities against improvements in longevity there is speculation these DIY swaps may replace bulk annuity buy-ins by pension funds.
The $178 billion CalPERS is considering inflation-linked assets, such as the water bonds issued by the World Bank, as part of an over-riding view to allocate capital to climate change initiatives.
The financial crisis struck as many of the state-owned portfolio companies held by Khazanah Nasional Berdad, Malaysia’s $23 billion (RM82 billion) sovereign wealth fund (SWF), were learning to operate with new executive leaders and, crucially, less gearing. Simon Mumme charts the progress of the manager’s attempts to strengthen and diversify the Malaysian economy throughout the crisis and beyond.
As institutional investors have been hit hard by events of the past 18 months, there has been a surge of interest in the adoption of an additional, mid-term, time frame in which to provide investment
targets. Watson Wyatt believes pension funds should allocate between 5 and 15 per cent of their risk budget to dynamic asset allocation.