nrpn’s latest quarterly investment survey of 23 Nordic pension funds reveals nearly half (43.5 per cent) of these funds are increasing their equity exposure to real estate, up 15 per cent from March 2010’s quarterly figure of 28.6 per cent. Only 4.3 per cent of respondents are reducing their exposure to property.

Private equity continues to be one of the most popular alternative assets, with 40.9 per cent of funds planning to bolster their holdings in this area, compared with 42.9 per cent in the last quarter. The number of schemes increasing their exposure to forestry also remains constant this quarter at 31.8 per cent, compared with 33 per cent in March 2010.

The increased interest in alternative assets comes as investors grow more optimistic about the general global economy, the survey suggests. Nearly 80 per cent of respondents said they are positive about world growth prospects for the next six months, up from 60 per cent in March 2010. Significantly, this quarter, no funds said they were negative about world growth prospects over the next six months. This compares with nearly 10 per cent of funds last quarter rating growth prospects as negative.

However, the survey shows investors are still exercising some caution, with 22 per cent of pension funds planning to raise their exposure to fixed income. Furthermore, nearly a fifth (17.4 per cent) will reduce their holdings in equities and cash. Commodities are also being viewed less favourably, with 18.2 per cent planning to lessen their exposure in this area, compared with 13.6 per cent that plan to increase holdings.

The full findings of nrpn’s quarterly survey can be found on pages 14-15.

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