South Korea’s sovereign wealth fund Korea Investment Corporation (KIC) has added more roles to its alternative investment division as it steps up plans to increase the allocation to alternative assets within the next 2-3 years.
Roles and responsibilities have been expanded across the division under changes to operating rules, industry sources said on Monday (November 2). The changes were focused on two sub-units dealing with strategy and absolute returns. There are three other sub-units that handle private equity, real estate and infrastructure.
In addition to developing new alternative investment strategies and post-investment management, the strategy group will now be responsible for formulating and executing the allocation plan by asset class.
The strategy group will handle the fund’s alternative assets and manage the relevant database, playing a more active role in the management of the fund’s alternative investment portfolio. Market research and collaborations with other asset owners and managers at home and abroad will be prioritized,and the strategy group will also take on a new role of managing taxation.
Meawhile, the absolute returns group will cover the fund’s investment in private debt in addition to hedge funds. Its added responsibilities include overseeing the investment process from finding investment opportunities in the private debt market to managing and evaluating the private debt portfolio.
The changes are in line with KIC’s plan to invest more money in alternative assets. Chief executive officer Choi Hee-nam, who was appointed in 2018, said last year the fund would raise the allocation to alternative assets to 20% within two to three years. Its exposure to the asset class amounted to 15.6%, or $24.5 billion, at the end of 2019. (Reporting by Hee-yeon Han)