Institutional investors across Asia – even large pension funds that are generally conservative in their investing approach – are increasingly turning to emerging markets, especially on the equities side, industry figures say.

Japan’s Government Pension Investment Fund is a case in point. GPIF, the world’s largest pension fund by assets, which stood at ￥111.9tn ($1.17tn) as of last December, awarded six mandates to external managers in July to oversee its foray into emerging market equities. This month, the pension fund handed out a seventh mandate, hiring Sumitomo Mitsui Trust Bank as a direct counterparty and Baring Asset Management as subadviser.

It appears that the pension fund is open to even more emerging-market exposure. Takahiro Mitani, president of GPIF, told Bloomberg last month that the fund plans to re-evaluate its 67 per cent target allocation to domestic bonds and may decide to increase holdings in emerging-market equities and alternative assets.