TOKYO (Reuters)- Low government bond yields and volatile currency markets are pushing Japan’s traditionally conservative life insurers into riskier investments to boost returns, with hedge funds and private equity set to get more of their huge cash pile.
With little prospect of higher interest rates this year as the U.S. economy slows, some Japanese insurers — which collectively manage about $1.6 trillion in assets, nearly the size of Italy’s economy — said they planned to cut domestic and foreign bond holdings in favour of alternative investments.
Those keen on hedge funds among Japan’s nine largest insurers, who briefed Reuters on their strategies in a series of interviews, say turbulent times for investors have weeded out the sector and created new opportunities.
