There has been a significant increase in the proportion of UK public pension schemes which invest in hedge funds over the course of 2009 and into the first half of 2010. Today 53% of all UK public pension funds invest in the asset class, a significant increase from Q1 2009 when only 37.5% had exposure to hedge funds. Most of these investors are relative newcomers to the asset class with the average UK public pension fund investor having made its first allocation to a fund within the last three years. This growing trend for rising numbers of pension funds in the UK active in hedge funds, coupled with the increasing tendency for pension funds to allocate larger sums to the asset class, will lead to this group of investor becoming an increasingly important source of capital to the hedge fund industry over the next 12 to 18 months.
Read the full Preqin report on public pension schemes investing in hedge funds.