Equity allocations by the nation's largest 200 pension funds
topped 60% for both defined benefit and defined contribution plans,
their highest levels ever, according to Pensions & Investments'
Among the largest 200 pension plan sponsors, the aggregate equity allocation (U.S. and non-U.S.) for defined benefit plans rose to 60.1% as of Sept. 30, a rise from 56.2% a year earlier. The aggregate equity allocation for defined contribution plans rose to 67.5% as of Sept. 30, an increase from 58.6%.
After taking into account the rise of the S&P 500 stock index, the survey shows the largest 200 pension plans pulling about $140 billion out of the U.S. stock market in the one-year period.
In addition, the 200 biggest pension funds continued to increase defined benefit money invested in alternative assets, but at a much slower pace, according to the survey.
Equity real estate investments grew by a market- adjusted 3% to $73.8 billion for the year ended Sept. 30.
Money invested in buyout, venture capital and private equity partnerships also increased, although accounting for growth and declines is difficult because of the lack of a widely accepted benchmark. The amount of money invested in buyouts by the top 200 funds grew 30% to $17 billion for the year ended Sept. 30. Money invested in venture capital increased 25% to $13.3 billion. The overall amount inves ted in private equity decreased slightly to $12.31 billion because of a decline in U.S. private equity, but money in international private equity rose 64%.
Western National Life Insurance and First Chicago NBD Investment Management collaborated in development of the Pegasus Flex-Choice Annuity, a fixed annuity retirement savings vehicle.
First Chicago NBD is the investment manager of the annuity and will manage the assets in intermediate term, high quality fixed-income instruments. Western National Life is the underwriter. The new annuity broadens First Chicago NBD's Pegasus line of mutual funds and other retirement savings vehicles.
Commercial Union Investment Management launched th e first publicly listed fund designed to track China B Shares. The open-end China Index Fund Ltd. tracks publicly traded shares quoted on the combined Shanghai and Shenzhen Stock exchanges. Long Investment Management, is the invest ment adviser.