Pension trustees are now willing to accept that alternative assets have both a key role to play in reducing portfolio risk and offer the chance of delivering attractive returns, according to a poll by Aon Hewitt.
The firm surveyed over 750 trustees at its annual pension conferences earlier this year. Its findings, published in Global pension risk, show that 40% of delegates would consider investing in other asset classes in order to reduce portfolio risk. More than a third (36%) of schemes expect to increase their allocation to alternatives over the next 12 months.
'In the current hostile market environment, pension schemes are examining every opportunity to balance risk and reward in their investment strategy,' said Tim Giles, partner in Aon's Global Investment Practice.
The increase means that a number of schemes will seek guidance from third party experts on both how to assess and to access new asset classes and investment strategies that they are unfamiliar with, said Aon.
Giles added: 'As a consequence of this growing willingness to look at new options, some schemes are also strengthening their expertise in order to have a better understanding of the asset classes they are using - and this is reflected by the growing prevalence of fiduciary management.'