Analysis

The world’s largest sovereign wealth fund rode the tech rally for all it was worth but still underperformed its benchmark by a hair’s breadth owing to unlisted real estate and infrastructure woes.

The UK government is set to follow the Australian example by pressuring default pension funds to perform or fold under a new draft framework released last week.

It was one of the little funds that could, until – for reasons mostly beyond its control – it couldn’t. But there’s still plenty the superannuation industry can learn from AvSuper, the $2.4 billion aviation industry fund that prided itself on member services and innovative investments.

The collision of transition and physical risks could see “significant economic damage” and system-wide asset losses, according to WTW, and conventional risk management and allocation techniques don’t apply.

Plenty of big institutional investors are finding that the total portfolio approach eats strategic asset allocation for breakfast. But as their organisations become more and more complex, shifting towards a new way of investing is getting harder.

Sovereign wealth funds are changing their asset mix and have executed a stunning U-turn on artificial intelligence investments, according to the latest Invesco annual survey of the sector.

For those looking to chase the growth tail and tip into what are a small clutch of highly priced equities, Pzena has a sobering history lesson. Meanwhile, the bounce-back for value portfolios could be “quite extreme”.

Mergers can consume the day-to-day life of a fund for years. But the investment decisions made during the process determine whether the new fund – and its membership – will thrive from day one.

The $74 billion New Zealand Super has shot the lights out with a chunky one year return and is now looking to “scale and optimise” its organisation as it eyes a projected doubling in size over the next decade.

Passive investing may have skewed the numbers but the index-hugging wall of money can’t break the maths of markets, a new GMO paper argues.

Offshore offices might get super funds “closer to the action”, but they can come at a literal cost – and not every fund is prepared to pay it.

The NZ Superannuation Fund has notched up back-to-back results as the best-performing and one of the most-sustainable sovereign investment vehicles in the world in a new review of the sector.