UK - The £2.4bn Lothian Pension Fund has awarded an £800m active currency overlay mandate to three managers.
AG Bisset & Co, Record Currency Management (RCM) and JP Morgan have been contracted to manage the mandate. They are to implement a 50% passive hedge and actively target a 2% return from the nominal foreign currency exposure of the fund.
It is the scheme’s first foray into currency overlay with the design to manage the risk of the fund’s foreign exchange exposure and add positive return, confirmed a spokeswoman for the fund.
She said: “AG Bisset has experience of managing currency overlay programmes backed by a consistent long-term track record. The quantitative approach offered from RCM has performed strongly over the long term and matches the fund’s objectives in this area.
“Complementing these managers is the blended approach from JP Morgan with an experienced research team,” she added.
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