Facebook Twitter Instagram
    • About
    • Subscribe
    • Contact
    • Report Library
    • Manager Login
    Facebook Twitter LinkedIn RSS
    HedgeNordic
    • Home
    • Allocator Angle
    • Report Library
    • Nordic Hedge Award
      • Nominations 2021 Nordic Hedge Award
      • Rookie of the Year
      • Jury Board
      • Historic Winners
      • Statistics
    • Nordic Hedge Index
    • Webinars & Podcasts
    HedgeNordic

    Varma Continues Hedge Fund Allocations Unabated

    Glenn Leaper, PhDBy Glenn Leaper, PhD05/05/20171 Comment
    Facebook Twitter LinkedIn Email

    Stockholm (HedgeNordic) – An in-depth feature in the May issue of the Investment & Pensions Europe magazine highlights Varma, the largest private pension insurance company in Finland with €43 billion in AUM, and its continuing dedication to being a hedge fund allocator, despite the widening gulf between pension funds and hedge funds elsewhere in the Nordics in recent years.

    According to CIO Reima Rytsölä (pictured), Varma distinguishes itself from other Finnish pension funds through this very hedge fund allocation. “We have a long history in alternatives,” he told IPE’s Carlo Svaluto Moreolo. “We started at the beginning of this century and we can say that, even though the industry has been under pressure, our hedge fund portfolio has been able to produce decent returns.” Varma began its foray into the hedge fund industry in the search for portfolio diversification, now employing three people devoted to that task alone.

    Varma presently allocates 17% to hedge funds, of which 7% in private equity funds and 2% in unlisted equities via co-investments, producing a 5.6% return in 2016, “with relatively low volatility” and good fixed income returns, according to its annual report. The pension fund blends a core portfolio and an opportunistic portfolio of roughly equal size, IPE reports, with the former targeting low volatility with a market neutral approach and the latter accepting more volatility in exchange for higher returns by, for example, targeting strategies like illiquid credit. Rytsölä explained the hedge fund allocation to be among the tools Varma employs to fight inflation, but acknowledges the prevailing perception of high fees and underperformance as currently haunting the industry, which is “one of the explaining factors behind compressed returns.”

    “Looking ahead, the interest-rate environment is strongly supporting the appeal of the hedge fund industry. We think what’s threatening the industry more is the emergence of systematic risk premia strategies that are becoming more popular among investors. Some hedge funds have tried to replicate the simple risk premia strategies, which are accessible for a much lower fee than what traditional hedge funds are charging,” accounting to some degree for compressed fee levels, Rytsölä suggests.

    Despite the share dedicated to alternative investments indicating a potential preference for active management, Varma remains predominantly a passive manager, Rytsölä explains. Read the full feature in IPE here.

     

     

    Share. Facebook Twitter LinkedIn Email
    Previous ArticleIPM and Aktie-Ansvar end Kvanthedge cooperation
    Next Article April Turnaround For Alchemy
    Glenn Leaper, PhD

    Glenn W. Leaper, Associate Editor and Political Risk Analyst with Nordic Business Media AB, completed his Ph.D. in Politics and Critical Theory from Royal Holloway, University of London in 2015. He is involved with a number of initiatives, including political research, communications consulting (speechwriting), journalism and writing his post-doctoral book. Glenn has an international background spanning the UK, France, Austria, Spain, Belgium and his native Denmark. He holds an MA in English and a BA in International Relations.

    Related Posts

    Head of Alts Jumps Ship to Join AP Pension

    Real Assets: AP4’s True “Alternative”

    The Holy Grail of Diversification

    View 1 Comment

    1 Comment

    1. Pingback: PRI Launches Hedge Fund ESG Due-Diligence Questionnaire | NordSip

    Leave A Reply Cancel Reply

    Time limit is exhausted. Please reload CAPTCHA.

    Most read today:
    • Janus Henderson Onboards Danske Bank’s EMD Team
    • Are We in for a Soft Landing?
    • PFA Hires PM from Hedge Fund Space
    • The Winners at the 2021 Nordic Hedge Award
    • Nordic Hedge Award – Main
    • Nykredit Hires Head of Alts
    • In-Depth: Inflation Protection

    Ukraine, Supply-Chain Shortages and Soaring Prices – Accelerators of Sustainable Development

    18/05/2022

    New Theme: Real Income Destruction

    17/05/2022

    Blockification

    16/05/2022

    The Inflation Puzzle

    12/05/2022
    Promotion:
    Video: Manager Interviews
    https://www.youtube.com/watch?v=tni7dQvQrmo

    Subscribe to our newsletter

    HedgeNordic: Your Single Access Point to the Nordic Hedge Fund Industry!

    Check your inbox now to confirm your subscription.

    Most read articles this week:
    • PFA Hires PM from Hedge Fund Space
    • Real Assets: AP4’s True “Alternative”
    • Month in Review – May 2022
    • A Light-Footed Shipping-Only Strategy
    • European Real Estate in the New Economic Climate
    • Are We in for a Soft Landing?
    • Recent
    • NHX
    • In Depth

    Head of Alts Jumps Ship to Join AP Pension

    28/06/2022

    Janus Henderson Onboards Danske Bank’s EMD Team

    27/06/2022

    Procrastinated Risk is Knocking on the Door

    23/06/2022

    PFA Hires PM from Hedge Fund Space

    22/06/2022

    Month in Review – May 2022

    22/06/2022

    Month in Review – April 2022

    12/05/2022

    Follow Your Favourite Hedge Fund

    11/05/2022

    Month in Review – March 2022

    13/04/2022

    Ukraine, Supply-Chain Shortages and Soaring Prices – Accelerators of Sustainable Development

    18/05/2022

    New Theme: Real Income Destruction

    17/05/2022

    Blockification

    16/05/2022

    The Inflation Puzzle

    12/05/2022
    Newsletter Subscription:
    Most Recent Posts:

    Head of Alts Jumps Ship to Join AP Pension

    28/06/2022

    Janus Henderson Onboards Danske Bank’s EMD Team

    27/06/2022

    Procrastinated Risk is Knocking on the Door

    23/06/2022

    PFA Hires PM from Hedge Fund Space

    22/06/2022

    Month in Review – May 2022

    22/06/2022
    Publisher

    Nordic Business Media AB
    Corporate No.: 556838-6170
    BOX 7285
    SE-103 89 Stockholm, Sweden

    VAT No.: SE-556838617001
    Tel.:+46 (0) 8 5333 8688
    Mob.: +46 (0) 7 06566688
    Email: info@hedgenordic.com

    STAY INFORMED

    HedgeNordic: Your Single Access Point to the Nordic Hedge Fund Industry!

    Subscribe to our newsletter:

    Check your inbox now to confirm your subscription.

    RSS Hedge Fund Job Digest
    • Fund Credit Officer - VP 27/06/2022
    • Fund Accountant - Non Exempt 27/06/2022
    • Fund Accounting Associate 27/06/2022
    • Quantitative Researcher 27/06/2022
    • Director - Credit Officer 27/06/2022
    • Entry Level - Fund Accountant 27/06/2022
    • Corporate Accountant​ 27/06/2022
    • Senior Associate - Fund Operations 27/06/2022

    Copyright © 2022 Nordic Business Media AB

    © 2022 Nordic Business Media AB
    • About
    • Cookie Policy
    • Privacy Policy

    Type above and press Enter to search. Press Esc to cancel.

    We are using cookies to give you the best experience on our website.

    HedgeNordic
    Powered by  GDPR Cookie Compliance
    Privacy Overview

    This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

    Strictly Necessary Cookies

    Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.

    If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.