Alecta, which is Sweden’s biggest pension manager with about $130 billion assets, is ditching stocks and bonds for alternative assets, according to Pionline.com.
The pension fund is eyeing infrastructure projects and residential housing to hedge against accelerating inflation.
Alecta’s chief investment officer Hans Sterte says the firm sees inflation rising in the long term, which supports the fund’s switch to more real assets.
Sterte’s comments come when Sweden markets grapple with overvaluation, with the benchmark stock index up 30% this year.
Sterte’s concerns are shared by other high-profile investors such as Michael Burry, who has likened today’s economic policy with the German hyperinflation of the 1920s.
Alecta plans to increase holdings of alternative assets to 20% by 2024, from the current 12%.