Future Fund hires head of equities from Sweden's AP4

Australia’s A$117 billion Future Fund has appointed Swedish pension fund manager Björn Kvarnskog as head of equities, starting in 2016.

Kvarnskog will also become a member of the Future Fund’s investment committee and will report to the fund’s chief investment officer, Dr Raphael Arndt.

Most recently, Kvarnskog was head of equities with Swedish pension fund AP4. His previous roles included senior equities investment positions with DnB NOR Asset Management, AP3 and Alfred Berg Asset Management.

Arndt said, “I am delighted that Björn is joining us and will bring his extensive experience in long-term investing and leadership to the fund. Bringing together different investment perspectives is enormously important to how we run the portfolio and Björn will be a great addition to our thinking."

Kvarnskog will relocate from Stockholm to take up his position in early 2016. In the meantme, Sarah Carne who has been the acting head of equities, will continue to lead the team until Kvarnskog’s arrival.

The Future Fund doubled its cash position in the past 12 months in the face of increased global market volatility, as reported. The investment portfolio returned 15.4% in the latest 12-month period against a 6% target return. Over five years the return stands at 11.9%, and 8% since 2006 inception.

“We have taken advantage of strong markets to reduce our listed equities exposure as well as to sell out of a number of private market positions that had delivered well," said managing director David Neal. "Overall we have been moderately reducing total portfolio risk.”

The Future Fund generated investment returns of A$15.6 billion for the 2014/15 financial year, taking the value of the fund to A$117.22 billion.

The portfolio’s exposure to listed equities, both Australian and global, was 42% in the 2014 financial results. It was expected to remain at this level, but is down to 33.8% in the figures to June 30 this year. Exposure to private equity has risen slightly as a proportion of the fund, from 8.3% to 10.8%.