Pension fund investment in UK equities fell to a record low in 2007, according to research by BNY Mellon Asset Servicing. Their weighting to these assets fell to 28.7 percent from 34.4 percent in 2006, as the FTSE 100 share index. Their allocation to global equities fell to 55.1 percent, from 62.7 percent in 2006, an eighth consecutive annual fall.
Pension funds moved their money out of volatile equities and into relatively safer bonds and index-linked investments, pushing their overall allocation to UK bonds above UK equities for the first time, BNY Mellon said. The overall weighting of bonds in pension funds’ asset portfolios rose to 27.6 percent, from 23.9 percent in 2006. Their allocation to alternative investments, such as hedge funds and private equity, rose to 1.6 percent from 0.8 percent.