Hedge funds lose favour in Australia’s US$2.6 trillion pension pot

The average allocation to hedge funds was just 0.6% of growth investment options across Australia’s A$3.9 trillion or about US$2.6 trillion pension pot in March, compared with 2.5% in mid 2020. — AFP

SYDNEY: One of the world’s fastest growing pools of retirement capital is reducing its investments in hedge funds as regulatory scrutiny grows on fees and performance at Australian pension funds.

The average allocation to hedge funds was just 0.6% of growth investment options across Australia’s A$3.9 trillion or about US$2.6 trillion pension pot in March, compared with 2.5% in mid 2020, according to the most recent data compiled by Chant West, a research firm.