UK - The BT Pension Scheme (BTPS) has more than doubled its allocation to alternative assets from 7% to 15%.
The £38.4bn scheme, managed by Hermes Pension Management, which also acts as investment adviser to the fund, has invested in private equity, hedge funds and commodities.
Hermes Pension Management CEO Mark Anson said: “Although last year saw strong performances in more tradition asset classes, we are looking to derive strong investment returns from alternatives this year.”
BTPS, the largest in the UK, said while last year saw particularly strong performances from the more traditional categories of equities and property, the scheme’s allocation to alternative assets would continue to increase during the course of this year as the fund both diversifies its risk and seeks to maintain the long term return potential relative to its liabilities.
BTPS investment returns for 2006 were 12.7%, outperforming its benchmark return of 11.3%. It is said the investment returns generated from the scheme in 2006 have resulted in over £600m of additional value.
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