Germany's largest public pension scheme, BVK (Bayerische
Versorgungskammer), is planning to add two or three more funds
of funds to its already sizeable roster.
The $68 billion scheme, which is based in Munich, currently
holds seven FoHFs that manage a total of $3.7 billion. While
many investors are looking increasingly to invest directly,
BVK's relatively small hedge fund team still sees FoHFs as the
most effective way to implement its investment strategy.
Typically, BVK will look to invest in a multi-strategy
vehicle, and then request more 'bespoke' services if the
The scheme places more importance on funds that meet their
return target and provide a stable returns profile than those
that generate excess returns, partly due to its master/feeder
structure as the manager for a number of smaller public
pensions, which have their own varying return targets.
The scheme is understood to be 'very open' to FoHFs with a
particular skew towards emerging managers, as it believes there
is a 'sweet spot' in terms of delivering alpha.