PKA, one of Denmark’s largest pension service providers, is exploring whether to increase its risk budget by 10 per cent to boost returns. Michael Flycht, deputy director of equities and liquid alternatives at PKA, outlines why the fund is achieving this objective via leverage rather than direct exposures, and where it's allocating towards in hedge funds and infrastructure.
Discussing how they integrate sustainability across their portfolios investors at New York State Common Fund, PKA, and TCorp, highlight the importance of manager selection and the challenge of the data gap.
More than 70 investors have collaborated to produce a framework for an investment strategy led approach to decarbonising portfolios and maximising efforts to achieve net zero emissions globally by 2050. The IIGCC, which developed the framework, is seeking consultation.
The top-five Danish pension fund, PKA, has made a bigger push into alternatives than its peers, and a good chunk of that allocation comes from direct investment in offshore and onshore wind farms.
In one of the biggest allocations among the fund’s Danish and European peers, PKA has grown its alternatives portfolio to account for 25 per cent of assets under management.
Despite upturns in equity and bond prices sending 2012 returns into double digits at many large Danish funds, it appears that successfully implementing infrastructure initiatives remains the holy grail of Danish institutional investing. Instead of merely basking in 12.9-per-cent annual returns, Industriens Pension, for instance, used its 2012 results announcement to make a commitment to
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