FINLAND - Allocations to hedge funds by pension and pension-related funds have doubled since the start of the year, the latest statistics from the Finish Pension Alliance (TELA) have shown.
At the end of September, of the €124.3bn (US$182.5) managed by Finland’s pension and pension-related funds, €7.5bn (6%) was invested in hedge funds. This compared to the end of 2006, when €3.6bn (3.1%) of the €114.5bn in assets was invested in hedge funds.
In bonds, allocations fell from 41.1% at the start of the year, to 35.8% at the end of September.
Reijo Vanne, head of research and development at TELA, said the Insurance Supervisory Authority had carried out a special investigation related to the sub-prime loan crisis and found there were very minor risks in the hedge funds invested in by the Finnish pension funds and year-to-date return of the hedge fund investments in 2007 were around 8% on the invested capital.
Vanne also pointed out that the allocation of assets outside of Finland was increasing. At the end of 2000, 58.7% of assets were invested in Finland, with 26.7% invested in the rest of the euro area and 14.6% invested in the rest of the world.
However, at the end of September 2007, 29.7% was invested in Finland, 34% in the rest of the euro area and 36.3% in the rest of the world.
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