GREENWICH, Conn. - Canadian pension funds are moving steadily to increase their use of equities - especially non-Canadian equities, according to Greenwich Associates' latest survey.
The research and consulting firm reports Canadian funds expect to increase their average commitment to non-Canadian equities to 18.4% by 1996 from 14.9% in 1993 and 9.8% in 1991.
Their overall commitments to equities should increase to an average of 49.6% by 1996 from 44.3% in 1993, the survey found.
"There's a strong move toward equities in general in the asset mix," said Rodger Smith, partner at Greenwich Associates, in the report, "and Canadian officials are planning to continue."
Mr. Smith noted Canadian funds' use of EAFE stocks, emerging markets stocks and small-capitalization Canadian stocks is growing.
Behind the increased use of equities, said Mr. Smith, is increasing recognition by trustees and investment committees that equities provide superior returns over the long run.
The survey also found a willingness to seek high-quality asset managers, including non-Canadian managers with no investment presence in Canada, and a continuing shift from internal asset management.
The Canadian funds are using more specialty managers and fewer balanced managers, the survey found. In 1994, 66% used balanced managers, down from 74% in 1991.