NEW ZEALAND - The New Zealand Superannuation Fund said it plans to increase its exposure to private equity and real estate in the coming years, and that it spent the last year refining its manager selection process.
In its annual report for the year ending June 30, released today, the scheme said investments in timber, infrastructure and real estate all fall under the "private market" heading.
"Quality assets are more attractively priced and we believe will become still more so. The current environment is a particularly good time to begin private markets investment programmes," the report read.
The Superannuation scheme said investments were down 22.1% in the year ended June 30. At that time, assets totalled NZ$13.3bn (US$9.5bn), but more recent figures place the pension fund's assets at NZ$14.9bn.
In its report, officials at the scheme also said they had refined the way they look at the manager selection process after disappointing returns from active managers.
The report said: "We will now focus on what makes a good active management environment. This involves assessing the characteristics of a market or strategy that is conducive to generating excess returns; what constitutes a good investment strategy and what the best ways are to enter and to exit particular investments and markets."
According to the most recent data, as of August 31, the scheme invested 44.7% in international equity, 19.8% combined in international and domestic fixed income, 9.1% in property, 7.6% in timber, and 6.9% in domestic equity. The pension fund also invested 5.6% in infrastructure, 4.2% in commodities, 3.4% in cash, 1.1% in private equity and 0.6% in other private markets.
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