SWEDEN - The Skr 139.3bn (e15bn) AP1 is expected to review its $1bn (e794m) emerging market portfolio, currently managed by a product solution of UBS, in a move that could initiate a search for external managers.
Fund officials said: “The emerging markets equities portfolio is an area where we think it would make sense to be more active. One of the options that the review will look at is to use active managers externally. Managing the portfolio internally is not an option.”
The fund has invested 5% of its portfolio in the Pearl product solution of UBS. This portfolio returned 27.4%, lower than the benchmark return of 28.7%, as at December 31, 2003. Total equities portfolio returned 29.2%, while total returns of the fund amounted to 17.1% for 2003.
The fund is also expected to tender shortly for a global custodian for its international fixed income and global equity assets. Citibank has been the custodian for AP1 for the past ten years.
“After ten years, we feel it is time to have a new benchmarking for the services provided,” a spokesperson said.
Barclays manages a e1.2bn Europe and North America passive equities mandate and a e125m Pacific region passive mandate. Capital International runs a e125m Pacific region active brief, while Martin Currie and Nomura manage e423m Japanese equities mandates. A e506m semi-active fixed income mandate is run by Black Rock.
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