TLDR:
- The United Nations Joint Staff Pension Fund (UNJSPF) reduced its allocation to equity by 10% in response to tech overvaluation.
- The fund is now focusing on new allocations in venture, impact, and private credit, with an increased focus on fixed income.
The UNJSPF, with a $92.5 billion portfolio, is under the leadership of Pedro Guazo, who has directed a more conservative strategic allocation due to the overvaluation in the tech sector. The fund has experienced sharp losses in 2022 but remains confident with a funded ratio of 111%. Guazo oversees a primarily dollar-denominated portfolio with a focus on simplicity and understanding of investments.
The fund has reduced its equity exposure to 43% and has diversified into fixed income investments, including high yield corporate bonds. The fund also remains cautious about global economic risks, especially from a potential economic slowdown in China. Guazo emphasizes the importance of closely monitoring the US and Chinese economies for their impact on the portfolio.
Additionally, the UNJSPF is exploring impact investments aligned with the Sustainable Development Goals (SDGs) across all asset classes. Guazo is particularly interested in combining impact with venture allocations in private equity. The fund will continue to focus on internal management to keep costs low and plans to scale up its allocations in venture, impact, and fixed income in the coming years. The fund is also venturing into new opportunities such as affordable housing in the US and remains vigilant about currency risks in its real estate investments.
