A significant reduction of equity exposure in pension funds is further proof of declining global confidence, research suggests.
A poll of UK pension schemes by Baring Asset Management (Barings) shows funds have reduced their equity allocations from 70.8% to 63.9% in the last 12 months. In addition, the study reveals a dramatic shift of allocation of pension fund assets to hedge funds, from a figure of 17% in 2006 to 47.8% this year. However, the average proportion of a scheme’s total assets allocated to hedge funds is still relatively low at 3.7%, up from 3.4% last year. Finally, the study reveals that emerging Asia is considered to be the region with the biggest potential for equity gains over the next ten years...
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