The $282 million Lothian Buses Pension Fund is looking at alternatives in the wake of a study by consultant Hymans Robertson.
Currently the fund's assets stand at equities $216 million, bonds $30 million, property $24 million, and cash $11 million.
However, a recent review has recommended that equity exposure be cut and the alternatives allocation - which currently consists entirely of the fund's holdings in property - be increased to include other asset classes.
Hedge funds are on the agenda along with private equity. However there is no rush to make the switch out of equities because the plan's equity portfolios