Europe's pensions flee hedge funds

.. in Europe the strength of traditional houses such as Standard Life Investments, Baring Asset Management and Ruffer in multi-asset investing meant sentiment towards hedge funds was "particularly grim" last year, according to MandateWire.

The SFr1.1bn ($1.2bn) Pensionkasse der Stadt Luzern axed its 3 per cent allocation to hedge funds last year with Konrad Wüest, pension fund manager, citing opaque fees and poor returns.

Likewise the €1.05bn Dutch Koninklijke Volker Wessels slashed its target hedge fund allocation from 17 to 5 per cent; the €6.3bn Suomi Mutual Life Assurance Company halved its target; and the SFr68m Pensionskasse der Katholischen Kirchgemeinde Luzern said it might scrap its hedge fund allocation entirely because it "does not contribute to diversification, it only adds risk".

Overall, net pension fund inflows to European hedge funds fell to £669m last year...