U.S. institutional assets grew 14% to $25.351 trillion in 2009, a return to asset levels recorded between 2005 and 2006, when asset levels were $23.935 trillion and $26.439 trillion, respectively, according to a report by The Conference Board, an independent business membership and research organization.
Pension plans were still the largest group of U.S. institutional investors, representing 39.9% of all institutional assets as of Dec. 31, 2009. Investment companies represented 28.4%, insurance companies, 24.4%, savings institutions, 4.9%; and foundations, 2.3%. Total is less than 100% due to rounding.\
“For decades, institutional investors have been shifting their allocations preferences from fixed income into equities,” Stephan Rabimov, an economist who co-authored the study, said in a Conference Board news release. “Findings illustrate that in 2009, after a one-year hiatus, institutional investors resumed this trend. By the end of the year, institutions invested 40.4% of their assets in equities and 38.6% in fixed income, with the remaining 21% invested in other asset classes.” A year earlier, institutions invested 36.6% in equities, 41.4% in bonds and 22% in other asset classes.
Pension funds also increased their allocations to alternative assets, with the asset class representing 27.9% of pension fund assets, according to the report.
The report's authors were not immediately available for comment.