UK - The £592m Cardiff and Vale of Glamorgan Pension Fund has blamed its UK and Japanese equity managers for its underperformance.
The fund was in the lower quartile of local authority fund performance for the year to the end of March while its assets fell by £13m.
Corporate manager Phillip Higgins said the underperformance arose mainly from its Japanese equities – which were consequently transferred to Schroder Investment Management from Invesco Asset Management this summer – and from its new UK active equities manager Jupiter Asset Management.
Higgins added that the relatively high proportion of the fund in passively managed UK equities had been another cause of underperformance as active managers have generally performed better over the last few years.
But a scheme review carried out by Hewitt Bacon & Woodrow advised retaining the existing passive UK equities weighting in view of the “exceptional movements in this market in recent times”.
Higgins added: “It was also considered that this was not a time to exit equities generally as the fund was well positioned for a recovery.”
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