Cyprus’ largest pension fund is planning to add two new asset classes into its overall portfolio and is weighing up an allocation to Africa.
The €228m Cyprus Hotel Employees Provident Fund said it planned to “increase its diversification by adding two new categories, emerging markets equities and European real estate”.
The fund was also considering an investment in Africa, the pension fund announced following its annual general meeting on 8 June.
In 2016, the Hotel Employees Provident Fund made a return on its portfolio of 2.7%.
Within this, it said, global investments generated 3.4% and local investments produced 2%.
The global return was driven by equity investments, which returned 7.8%, and infrastructure projects, which produced an 8.5% return.
Also within the global allocation, absolute return investments made 1.2% and global macro strategies returned 0.6%. However, the fund’s alternative investments lost 0.3% and its allocation to diversified growth funds lost 1.6%, the pension fund reported.
The pension fund said: “The implementation of the investment strategy continued in 2016, when the dispersion of the portfolio increased, which contributed to the reduction of investment risks and led to better results for the members.”
It said the management committee’s commitment to a “prudent and rational” investment strategy had allowed the fund to maintain liquidity while continuing to pay benefits to outgoing members.