When nrpn asked funds whether they envisage raising their allocation to private equity over the next six months, 64.3 per cent said yes, while half expected to invest more in infrastructure (see page 14).

Interestingly, 50 per cent planned to reduce their exposure to fixed income, suggesting bonds could be the casualty in the growth of alternative assets.

Nicklas Fahlström, senior consultant at Wassum Investment Consulting, said: “We would welcome such a development. There is a lot of interest in these areas but so far little activity.

These assets from an overall theoretical point of view are under-represented in portfolios. They are long-term investments that suit a pension fund portfolio.”

Søren Andersen, CEO of Invensure, said the findings were in line with his expectations for Denmark, particularly the reduction in bond holdings, where Danish funds have historically been overweighted.

However, he warned that interpretations of both private equity and fixed income could vary between Danish funds.

“Private equity has been around in Denmark for about 40 years, not through funds but directly owned Danish private equity,” he explained. “If you ask a Danish pension fund or life insurance company, some would say this is not really private equity.

“The large funds might be more willing to increase their exposure to alternatives. The smaller ones will get there, but slowly.”

The research, which surveyed 14 Nordic pension funds, revealed downbeat expectations for equities across global markets. None of those surveyed anticipated equity returns above 10 per cent, while most expected returns of between 0 and 5 per cent.

Funds were most positive about Asia (ex Japan) and emerging market equities, with 57.1 per cent of funds expecting returns of between 5 and 10 per cent in these regions.

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