British pension funds are coping with low bond yields and high share prices by seeking riskier investments, in a hunt for the returns they need to meet their obligations to pensioners.
Collectively managing at least 2.5 trillion pounds ($3.69 trillion), pension funds are reeling from six years of money-printing by central banks globally, which has depressed yields so much that some bonds even cost investors money to hold them.
Speakers and delegates at a National Association of Pension Funds conference warned that pension fund investment into more volatile equities is fuelling a stock market bubble, where share valuations have risen to record levels even though corporate earnings have been disappointing.
