(Bloomberg) -- Pension funds are poised to shift as much as $1 trillion from stocks to bonds in coming years to lock in gains and limit the potential for big losses, according to Wells Fargo & Co.

“Definitely there’s a lot of money that will want to move,” said Andy Hunt, head of global credit and liability-driven investing at Wells Fargo Asset Management, predicting it will happen within roughly five years. “Best case, it’ll be between a half a trillion and a trillion.”

Struggling to make up a shortfall in funding, many pensions held on to large equity portfolios, trying to juice returns as ultra-low interest rates squeezed yields on bonds.

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.