US public pension funds may increase their allocation to
hedge funds at a faster rate than corporate pension plans due
to sweeping new corporate pension legislation that is beginning
to take hold in the US, according to Agecroft Partners.
The 2006 Pension Protection Act that became effective in
2008 includes two provisions that will alter how many corporate
pension fund assets are managed. The first provision affects
how companies determine the present value of the future
liability stream, which includes many variables, but dominated
by the discount rate.
The second provision...