UN Drags Feet On Alternatives

The United Nations Joint Staff Pension Fund, which manages $40.6 billion worth of assets, has yet to allocate funds to alternative investments – one year after advisers recommended investing in private equity and hedge funds, according to HedgeWeek.

At the end of March, the fund held 57% of its assets in equities, 36.8% in bonds, 1.8% in property and 4.4% in cash. In April last year, the U.S. firms Pension Consulting Alliance and EFI Actuaries compiled a report that recommended allocating up to 6% of its assets in alternatives, although they noted that investing in these asset classes would require significant resource and procedural adjustments from the fund itself.

The lack of response from the UN fund is seen as surprising, as these investment classes are easily accessible and available. However, there are signs that the UN fund may take a step towards alternative investment. Media reports earlier this year indicated that the pension fund had requested help from external investment consultants on alternatives.

Over the first quarter of the year, the fund suffered negative returns of 2.7%, suggesting that now might be a good time for the fund to speed up its research.

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