As the world's economy continues to evolve, pension plan investments need to adapt as well. In 2021, a report was released that assessed the performance of 11 Canadian pension plans, including the Alberta Investment Management Corp. (AIMCo). The report criticized the AIMCo's strategy, placing them last in their rankings. Despite two decades of steady gains, the fund simply hasn't performed as well as it could have, and the report points to a lack of Investment strategy as the primary cause.
In Florida, the state's pension fund is also facing criticism for its use of ESG (environmental, social and governance) investing strategies. Governor Ron DeSantis and his cabinet have remained focused on changing the fund's Investment strategy, in order to ensure it can continue to provide retirement payouts to more than 2 million members.
Experts in the field of pension plan investments are predicting that Investment strategies in 2023 could look very different from what we see today. Bloomberg asked four of Australia's smaller pension funds about their key Investment strategies for 2023, and a few interesting points were raised.
The most interesting finding from the study was that asset owners, such as pension funds and institutional investors, should consider diversifying their alternative investments. This could include venture capital, private equity, hedge funds, and real estate investments. Additionally, asset owners should take into account environmental trends when making their decisions.
Advisors can also play an important role in helping pension funds adjust their Investment strategies. CalPERS recently appointed Peter Cashion as their managing Investment director, to oversee the state's more than $220 billion in pension funds. His expertise in the field of investments could help the pension fund adjust its approach and make better decisions.
The Swedish national pensions buffer fund, AP4, also announced its plans for 2023. The fund plans to invest in renewable energy, equity invest with the Global Environment Fund, and strategy consultant. This is part of their larger Investment strategy, which includes a focus on ESG factors and low carbon investments.
As pension plans continue to evolve and their investments change, it is important to stay up to date with the latest trends. Advisors and asset owners can help pension funds adjust their strategies to ensure that they are getting the most out of their investments.
