Education pension fund goes it alone

Tue Sep 1, 2009



After the recent market turmoil opened up access to top managers, Universities Superannuation Scheme is building up its alternatives team to invest directly with approximately 25 hedge funds


After the recent market turmoil opened up access to top managers, Universities Superannuation Scheme is building up its alternatives team to invest directly with approximately 25 hedge funds

By Niki Natarajan

Universities Superannuation Scheme (USS) is taking an innovative approach to hedge fund investing, at least compared to its UK peers, most of which use funds of funds. The corporate trustee of the second largest pension fund in the UK, which plans to put 20% of its total assets to work in alternatives, has opted for the core-satellite system of hedge fund investing that will eventually see direct allocations of some $80 million apiece going to roughly 25 hedge fund managers.


Mike Powell


Core-satellite in the long-only world was Frank Russell's calling card when it was one of the top three pension fund consultants. To do this, USS has used hedge fund replicators to give hedge fund-like returns in...

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