Pensions Have $1.4T Invested in Alternative Assets: Survey

More than $1.4 trillion in global pension assets are parked in alternative investments, such as real estate, private equity and hedge funds, according to research from professional services firm Towers Watson .

Pension assets make up just over half of the money that the largest alternative-asset managers steward, it found.

Public and private-sector pension funds represent about a third of the assets invested with the top 100 such managers. Among pension funds, the most popular alternative asset is real-estate, with a 36% share, followed by private equity and PE funds of funds, at 35%, and hedge funds and funds of funds, at 18%. Infrastructure funds, illiquid credit and commodities round out the bottom.

About $6.3 trillion in assets were in the hands of 623 large alternative-investment managers at the end of last year,  up 10.5% from a year earlier, Towers Watson found. The top 100 alternative-investment managers managed just over $3.5 trillion of this pool, up 7% from last year.

“Institutional investors continue to invest capital in opportunities other than bonds and equities,” said Brad Morrow, head of investment-manager research for the Americas with Towers Watson. “Many asset managers in this area will continue to attract capital.”

Source: WSJ