Future Fund expands hedge funds portfolio
Australia's Future Fund expanded its portfolio by iallocating in U.S. hedge funds and developed markets in the 2009 – 2010 financial year.
The superannuation guardian appointed nine US-based and one British-based boutique hedge funds to manage $9.8 billion. The figure is more than 300 percent higher than the $2.6 billion invested in June last year.
The investment brings $10 billion or more than 15 percent of assets into the 'alternatives program' which has been considered as the utilization of “skilled managers to take advantage of capital scarcity and market inefficiency.”
The overseas investments were seen as an effort to veer away from relying too much on its 10.9 percent stake at Telstra Corporation.
According to chief investment officer Mark Delaney, the Australian super has also 40 percent of global equities allocated to developing markets. Of the fund's $23.2 billion investment in equities, a third went to Australian equities while the European and North American markets took up the rest of the share.
The fund continues to keep large cash holdings in its asset portfolio as it waits for global markets to recover from the global financial crisis of 2008. The cash holding, however, were reduced from $22.2 billion in June 2009 to $8.2 billion this year.