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2014 European Asset Allocation Survey


Mercer is proud to present our 2014 European Asset Allocation Survey.

This year our survey covered over 1,200 plans from 14 countries, with total assets of over €850 billion.

In this year’s survey we find that the long-observed downward trend in equity allocations continues, albeit at a reduced pace. This likely reflects a combination of factors, including low bond yields, improving sentiment and rising equity markets.

The management of interest rate and inflation risk remains a high priority for pension plan trustees and the proportion of plans across Europe that allocate a portion of their assets to a liability hedging (or Liability Driven Investing (‘LDI’)) mandate increased from 26% to 29% over the past year. In addition, we see an increased allocation to a broad range of alternative asset classes, particularly in real assets and growth-oriented fixed income. Over half of the plans surveyed now have an allocation to alternatives.

  View Our Key Findings Infographic
 
 

“Perhaps counter-intuitively, the weak economic growth of the last few years has coincided with exceptionally strong equity markets. The rising market and improving sentiment are likely to have been the key supports to equity allocations over the last year, though there remains scant evidence of any ‘great rotation’ in institutional portfolios.


“Many markets have risen in response to the ultra-stimulative monetary policy pursued since 2009 – as a result, prospective returns are arguably uninspiring across a range of asset classes. We expect institutional investors to meet this challenge by responding more dynamically to changing market conditions and introducing a wider range of return drivers into portfolios.”

Phil Edwards, European Director of Strategic Research for Mercer's Investments business

BUSINESS CONTACT

Claire Fazio
Tel: +44 (0)1753 848155

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