Byline: Pirkko Juntunen

Pirelli Cables UK pension fund has made its first investment in a fund of hedge funds, putting $35m ([euro]27.8m) with HSBC Republic Investments, the alternative investments arm of the HSBC group, according to sources close to the tender process.It is the first institutional win for HSBC Republic Investments this year and is one of the first among smaller UK institutions to commit funds to the asset class, according to the source.

Officials at HSBC Republic Investments declined to comment. Officials at the Pirelli fund did not return calls.

According to The Pension Funds and their Advisers 2002, which lists the largests UK pension funds, the Pirelli fund had assets totaling [pounds sterling]220m managed through the Pirelli Common Investment Fund.

HSBC Republic Investments has made clear it wants to make further inroads into the institutional market which has shown an increasing interest in hedge funds following the poor returns of the equity markets in the past few years. The alternative asset arm wants to utilise the expertise and the brand which HSBC Asset Management has built among institutions and investments consultants. …