Officials for VIA Rail Canada Inc., Montreal, with about C$1 billion (U.S.$735 million) in pension assets, have begun an informal search to expand the fund's managed futures exposure.
VIA Rail expects to allocate an additional C$15 million to managed futures; earlier this year, it invested $5 million in the category through a Bank of Montreal structured note.
Chris Coswell, director-corporate financial services, said the expanded managed futures program could be a passive investment using an index or a more active one using a manager-of-managers approach. He said the decision will be made after taking a look at what the market has to offer. He noted fund officials have begun to meet with managed futures managers.
The change in managed futures is part of a broad restructuring of VIA Rail's asset allocation that includes what it calls strategic investments, such as managed futures. Mr. Coswell declined to say what specific asset allocation changes have been made until more work is done on implementation. Generally, the changes are geared toward reducing the fund's exposure to Canadian inflation, because the fund's liabilities are partially inflation-indexed, he said.