The search for diversity coupled with a fall in local property market returns, which has seen the performance of IPD's Nordic property index slump from 16.1 per cent in 2000 to 6.6 per cent last year, has forced some pension funds overseas. The Danish Real Estate Club - a collaboration of five Danish funds - is looking to invest some €350m a year for the next three to five years in overseas indirect property funds. At the same time, Nordea Life & Pensions wants to increase its non-domestic property holdings almost ten-fold.

We also take a look at Sweden's much-maligned Premium Pension Authority (PPM), which has pulled in average returns of -8 per cent since its 2000 launch. We speak with Professor Karl-Olof Hammarkvist, who is leading a government inquiry into the system, as well as seven other leading figures, to get their thoughts as to how the PPM can be improved and why, although fifty per cent of the PPM's 697 funds are run by overseas investment managers, only seven per cent of investors chose foreign vehicles.

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