Australia’s biggest pension fund to cut global stocks allocation on AI concerns
Financial Times • • business
Key Points:
- Australia’s largest pension fund, AustralianSuper, plans to reduce its allocation to global equities next year due to concerns over high valuations and rapid leverage in US tech stocks linked to the AI boom.
- John Normand, head of investment strategy at AustralianSuper, highlighted the maturing AI cycle and anticipated Federal Reserve tightening in 2027 as key factors influencing this shift.
- Despite strong recent gains in tech stocks like Nvidia and Alphabet, AustralianSuper has been diversifying its overseas equity exposure by increasing investments in listed infrastructure companies since October.
- Similar caution is observed among other major pension funds, such as Canada’s CPPIB and various UK schemes, which are reducing exposure to concentrated US megacap tech stocks amid bubble risk concerns.
- Looking ahead
