AP7 cuts gearing and adds risk-factor investments

first_imgSweden’s AP7 plans to introduce factor investing into its portfolio for the first time as part of a risk-reduction exercise.The national pension fund that provides the default option in Sweden’s Premium Pension System (PPM) will also lower the gearing on its equity portfolio.The SEK430bn (€41.4bn) pension fund said: “As a step in implementing the new strategic portfolio, which was decided in 2016, AP7 is now starting to invest in factor premiums.”The goal, it said, was to invest 10% of the fund in these strategies over the next few years. 
“At the same time, the normal level of leverage is being reduced to 25%,” it said. This is reduction from the previous normal level of 35%.However, the actual level of gearing was to be set even lower, at 15% percent, AP7 said, due to its previous assessment of market valuations.At the end of December, the pension fund’s actual level of gearing was around 25%, according to its 2017 annual report.Since 2010, a central part of AP7’s management strategy for its SEK396bn equity fund – which accounts for the vast majority of its overall assets – has been passive exposure to a global index with leverage of 50%. AP7’s default option pension product, known as AP7 Såfa, is a lifecycle fund combining AP7’s equity and bond funds.In 2015, AP7’s board opted to halve the actual level of gearing to 25% because stockmarket valuations were considered high. In December 2016, when presenting a new strategic portfolio to be implemented by 2020, it reduced the normal leverage to 35% from 50% in order to increase the room for manoeuvre associated with the change.The first step in introducing other risks then began in 2017, and involved increased exposure to emerging markets and private equity, AP7 said.The pension fund said the new management strategy was aimed, in particular, at reducing risk through diversification.“Another central part of the strategy is to systematically apply more dynamic risk-taking, where the fund’s overall risk level is adjusted to extreme market valuations,” it said.In February the pension fund put out a tender for advice on “active alpha” procurement, in part of its move to add risk-factor investments to its portfolio.last_img read more

MBB : Orange inside game could receive boost with potential of Melo’s return Saturday

first_imgWith Fab Melo and Rakeem Christmas relegated to the Syracuse bench, the reality hit C.J. Fair.If Baye Keita, SU’s lone remaining big man with experience at the center position, picked up one more foul over the final 4:58 against West Virginia, he too would be forced to the sideline with five fouls.And that would push the 6-foot-8, 203-pound Fair to the center spot to battle with the Mountaineers’ 260-pound big men Kevin Jones and Deniz Kilicli.‘I thought about it for a second,’ Fair said, ‘and I’m like, ‘How am I going to play that big guy?’ But luckily Baye, he played his ground well.’Keita managed to avoid that fifth foul and finished SU’s 63-61 win over the Mountaineers on Saturday. Christmas and Keita have taken on much bigger roles on the offensive end and in the heart of No. 3 Syracuse’s 2-3 zone defense during Melo’s absence. But in the three games without Melo, at least one of those big men has struggled against the rugged Big East competition.AdvertisementThis is placeholder textMelo will return to the SU lineup for the team’s matchup against St. John’s on Saturday after missing three consecutive games for academic reasons, according to The Post-Standard. Pete Moore, SU director of athletic communications, said in an email that he could not confirm whether Melo would travel with the Orange (22-1, 9-1 Big East) this weekend or his availability for the matchup with the Red Storm (9-12, 3-6) Saturday at noon at Madison Square Garden. Depending on Melo’s availability, the Orange may once again have to make some small tweaks to its game plan.‘We just have to adjust,’ junior forward James Southerland said of playing without Melo. ‘That’s every game, though. You adjust to what’s going on, and you make the best of it.’Melo was a force inside for SU throughout the year and seemed to get better once conference play began. He leads the Orange in blocks and rebounds per game, and his 7-foot, 244-pound frame clogged up the middle of the 2-3 zone.The sophomore is two inches taller than Keita and three inches taller than Christmas, but the major difference comes in his bulk. Melo has roughly 30 pounds on Keita and 20 on Christmas.And though Fair was concerned with how he would handle West Virginia’s big men Saturday, head coach Jim Boeheim said Christmas and Keita aren’t quite prepared for that type of competition, either.‘Those guys, they’re not really ready physically to play in this league,’ Boeheim said. ‘They’re going to have to foul sometimes. We want to foul guys like Kilicli if he’s not making shots, missing free throws. We tried to foul (Cincinnati’s) Yancy Gates the other night. Just use some fouls in that situation.’Christmas and Keita have picked up nine fouls each in this three-game stretch, but the biggest problem has been getting solid performances out of both big men in the same game.Against Notre Dame, neither could stop Fighting Irish forward Jack Cooley in SU’s only loss this year. At Cincinnati, freshman Christmas had his best game of the year, while Keita didn’t score and grabbed just one rebound. And against West Virginia, Boeheim was happy with Keita, but Christmas lacked energy.‘I thought Rakeem looked lost in space today,’ Boeheim said after the win over the Mountaineers. ‘He looked like a freshman.‘I just wondered if he was awake. I wasn’t sure. I just tried to make sure he was awake.’Melo’s return Saturday would be a huge boost for the Orange. But even if he doesn’t play, his presence alone can help SU’s other two big men.He works through things with them in practices but also gave them feedback during the game Saturday. He did not travel with the team on the road trip to Notre Dame and Cincinnati.And whether he plays or is just there on the bench against the Red Storm, Keita knows it will be a major benefit for himself and Christmas.‘Having him on the bench, talking to him all the time will help me,’ Keita said. ‘We do the same thing during games. I’ll be sitting on the bench. Rakeem, too. We keep talking all the time.’zjbrown@syr.edu Comments Published on February 1, 2012 at 12:00 pmcenter_img Facebook Twitter Google+last_img read more