Japan’s public pension fund, the world’s largest investor of retirement savings, is building a team to invest in alternatives as it pushes into riskier assets.
As soon as the pension is ready it will be a significant player in the asset class, Hiro Mizuno, chief investment officer of the Government Pension Investment Fund, said at a Pensions & Investments conference in New York. The fund, which oversees about $1.1 trillion, isn’t required to invest in alternatives and will do so when it sees opportunities, he said.
The fund decided last year that it can allocate as much as 5 percent of holdings to alternative investments such as private equity, infrastructure and real estate. It also increased its targets to Japanese and overseas equities, while reducing fixed income exposure. The allocations were released hours after the Bank of Japan unexpectedly added to monetary easing.
Mizuno, hired last year from private-equity firm Coller Capital, said he doesn’t feel obliged to invest in alternatives because he knows the reality and challenges of investing huge amounts of capital in the asset class.