Panel session: How can local LPs achieve portfolio diversification and deal with investment limits

Moderator:

Chris Bruneau, Executive Director, 57 stars

Panelists:

Patricia Correa de Queiroz, Investment Director, Fundacao Real Grandeza

Sebastian Gray, Head of Alternatives, AFP Integra

Jorge Espada, Chief Risk Officer, AFP Profuturo

Fabio Mazzeo, Chief Executive Officer, Fundacao Metrus

Melvin Escudero, CEO, El Dorado Investments

There are limits in how much investors can allocate to the different asset classes. Some countries do not allow to invest in international private equity. Pension system in Latin America has grown around 15 to 20% on a yearly basis. So where do they invest all this new money? There were probably be a significant increase in international and local alternative products.

In a perfect world what type of allocation would there be to alternatives? Should there be a limit? In most Latin American countries there is a limit between 10 and 15%. These countries are trying to reach international standards and the current limits are almost full. In the next 5 to 10 years, these limits will probably be increased to around 20%.