Scheme investment in alternative assets increases by 40%

The survey – which polled the 99 of the biggest schemes in the world, including over a third from Europe – found alternative assets managed by pension funds grew to US$822bn (£418bn) up from US$586bn (£298bn) the year before.

Watson Wyatt global head of investment consulting Roger Urwin said: "There is no let up in the demand for alternative assets as pension funds around the world seek to diversify their portfolios and capture alpha through absolute return strategies.

"This is the main reason for such significant growth of assets, with the larger firms being the main beneficiaries of growth. Other features of the year were the increasing concentration and ongoing consolidation in the industry as well as the rise of infrastructure as an asset class."