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A lack of strategic assets can be a deterrent to domestic investment for large pension funds

Published: 27 August 2024

In 2023, the Government of Australia suggested that some of the country鈥檚 pension assets might be used to fund social housing or renewable energy. The idea received mixed reception, and to understand why, Lachlan Maddock of Investor Strategy News looked to Canada, where a group of business leaders called for pension funds to increase their holdings of Canadian equities. Maddock quoted research published by 看片视频 Desautels鈥 Associate Professor of Finance Sebastien Betermier. 鈥淲hen we consider the factors limiting domestic investment in Canada, we identify one major friction that deters Canadian pension funds from increasing their domestic share,鈥 wrote Betermier. By these [the lack of strategic assets] we mean specific asset classes that demonstrate distinct strategic benefits to a pension fund portfolio so that pension funds can meet their mandate to deliver regular, cost-efficient income for pensioners and sustain a healthy pension system.鈥

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