Pensions Warm to Stock Funds Modeled to Mirror Private-Equity Returns

Some pension managers are interested in investment strategies that seek to reproduce the performance of private-equity funds through a portfolio of public securities, as they look for less costly ways to match the returns associated with alternative assets.

Danish pension manager P+, Pensionskassen for Akademikere, recently invested $100 million in an AXS Investments LLC vehicle that tracks the Thomson Reuters Private Equity Buyout Index, which is designed to replicate the performance of private-equity funds.