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Korea Investment Corp to double alternative assets investment

24 Apr 2014

Sovereign wealth fund Korea Investment Corp (KIC) is set to double its exposure to alternative assets, its CIO Choo Heung Sik told Bloomberg.

Last year KIC’s previous CIO Lee Dong Ik said it would aim to allocate $10bn to alternatives, up from around $5.7bn at the time. Alternative assets currently make up ten per cent of the portfolio.

“We’ll have to embrace the lower return expectation from traditional assets and that will continue for a considerable period,” Cho said. “Considering such an environment, expanding into alternatives is one of the most efficient way to protect yield in the mid-to-longer term.”

KIC was established in July 2005 under the KIC Act, with a view to enhancing Korea’s sovereign wealth and contribute to the development of the domestic financial industry. It is mandated to manage assets entrusted by the Government and the Bank of Korea.

Recently KIC partnered with Russian state-backed fund RDIF to launch a $500m joint investment vehicle.

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