Institutional Investors

AP1 mulls first allocation

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AP1, one of Sweden's largest pension funds with assets of $27 billion, is starting to evaluate hedge funds with a view to making a potential allocation.

The news is likely to elicit considerable interest from the fund of funds community given the high-profile nature of the AP funds, which form part of the Swedish pay-as-you-go pension system.

The move may have been prompted by a need for diversification: 2008 saw the value of the fund dropping by 21.9%, with the key factor being the dramatic fall in equity markets. At the end of the year, the fund's equity exposure was