Institutional pension fund assets in the 13 major markets watched by Towers Watson rose 9% last year to a new high of $30 trillion (€22 trillion), says the investment consultancy.
The sum has more than doubled in ten years – implying average growth of 7% a year – despite global pension fund assets falling 21% in the 2008 financial crisis.
Towers Watson's report suggests total assets have increased significantly in real terms. Institutional pension fund assets in the 13 markets in 2012 were equivalent to 78% of global GDP, says the firm, compared with 72% in 2011 and 61% in 2008.
“During the past five years we have seen many funds deal with their governance shortfalls and as a result a growing number of funds have either more qualified people working on their investments or they have outsourced the running of all or part of their portfolios to third parties,” says Chris Ford, Europe, Middle East and Africa head of investment at Towers Watson.
“In addition, pension funds are implementing investment strategies that are more flexible and adaptable and which contain a broader view of risk so as to make greater allowance for extreme events.”
©2013 funds europe