The key to choosing alternatives

alternative investments

The collapse of the equity markets between 2000 and 2003 has caused investors to consider alternative assets for pension funds, including private equity and venture capital, hedge funds, commodities and even exposure to volatility

Traditionally UK corporate pension funds and individuals saving for retirement have invested primarily in a mixture of equities and bonds, with relatively smaller holdings in property and cash. However, the collapse of the equity markets between September 2000 and March 2003, combined with a shift towards market-based valuations for pension schemes, has persuaded investors to consider broadening their horizons. This has helped to stimulate a debate on whether alternative assets now also have a legitimate place within pension funds. Before weighing into this debate it is necessary to rememb...