Thursday, September 27, 2007

Pension Managers Still In Love With Alternative Investments

CNBC just beat me to the punch (I hate when that happens) on a post I was preparing to make on alternative investments. Citigroup put out some interesting notes from its recent survey of pension managers, who collectively manage over $1 trillion in assets.

Here are some of the findings it contained:
  • About 85% of pension managers will raise their allocation to alternative investments over the next 3 years
  • Within 3 years, private equity allocations will surpass both hedge fund and real estate allocations
  • Almost 90% of pension fund managers allocate to private equity vs. only 50% allocating to hedge funds
  • But hedge funds get more money, larger allocations
  • The majority of pension managers find the "2 & 20" fee structure unsustainable

I found most of the observations surprising, in that I would not have expected that many managers to say they will increase their allocations to alternatives over the next 3 years. I would have thought the peak had passed, and these allocations would decrease.

Go figure.


At 8:59 PM, Blogger Serg said...

My pension manager recently mentioned that many of his clients have been investing in property in Central America. Apparently the markets in Belize, Costa Rica and Nicaragua are seeing an annual appreciation of as much as 30%. I was initially hesitant to purchase property abroad however after doing some research I noticed that there are numerous websites geared towards the American consumer. I found , and to be the most helpful. Obviously this type of investment requires additional work on the investor’s part. In order to ensure that you’re dealing with reputable real estate agents it’s important to obtain references and treat the process as you would a state side real estate transaction.
I decided to start out by purchasing condominium complexes in Costa Rica and Nicaragua. Even though these investments are fairly new I have seen reasonable gains in the last year. Obviously these are long term investments so only time will tell if these markets will hold their ground.


Post a Comment

<< Home