UK - The £1.1bn UK Cadbury Schweppes pension fund is considering shifting 10% of its assets into alternatives, with infrastructure a strong candidate, as it seeks to diversify its portfolio.
Neil Burton, finance manager at Cadbury Schweppes pension fund, said the fund was looking for low risk investments which could give it a higher return than its bond portfolio.
The fund is currently invested in bonds, equities, private equity and property. “We are looking at investing 5% in each of two new asset classes,” he explained.
“Infrastructure has gone from a non-runner to being front of field, though it will all depend on the decision of the trustees.” Burton said infrastructure was attractive to a mature pension fund, because of the predictable nature of the returns. He added that the fund was reexamining hedge funds after previously dismissing them as too opaque and high risk.
“We now see them as offering diversity as well as high returns,” he said. Burton said the fund had first become interested in infrastructure after attending Global Pensions’ Alternative Investments conference in London earlier this year.
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