Defined contribution (DC) pension scheme assets now account for over half of total assets in the worlds seven largest pension markets for the first time ever.
That is according to figures from Willis Towers Watson (WLTW), which show that DC assets have grown by 8.9% over the last decade, compared with 4.6% for DB assets.
The average asset allocation of the 'P7' markets - Australia, Canada, Japan, the Netherlands, Switzerland, the UK and US - is 40% equities, 31% bonds, 26% other and 3% cash.
This marks a 20% fall in equity allocations over the past 20 years, and a 19% rise in investments in other assets like real estate.
Roger Urwin of WLTW's Thinking Ahead Institute, said growth in DC pension assets has reached a "pivotal moment", but that the next five to 10 years present a range of challenges.
"These include the shifting focus in pension design towards a DC model, the growing impact of evolved regulations and integration of ESG, stewardship and long-horizon investing," he added.
The figures show that the P7 accounts for 91% of assets in the world's 22 largest markets, with the US representing the most on 61.5%, followed by Japan on 7.7% and the UK on 7.1%.
It was also found that total global assets in the 22 markets fell by 3.3% to $40.1trn (£31trn) over 2018, but are still almost double the size recorded 10 years ago.
Australia and the US continued to have above average equity allocations, with 47% and 43% respectively, while the Netherlands, UK and Japan have above average exposure to bonds.
Switzerland has the most even allocations across equities, bonds and other assets.
Urwin said last year showed how much funds have benefited from private market diversification, adding: "2018 was the third worst year for pension asset growth in the last 20.
"But it would have been quite a lot worse without the contribution from private markets that produced important risk diversification."