Regulation 28 is not the problem, investor behaviours are
It’s textbook stuff that diversification is an essential element of investing that is likely to improve the risk-adjusted return
There’s a narrative on the go that retirement fund members are being done in by Regulation 28, because it condemns them to low returns.
Regulation 28 limits the extent to which retirement funds may invest in individual assets and asset classes. Although the aim is to protect members from poorly diversified portfolios, some commentators maintain that the category limit on “equities” (75%) and foreign investments (30%) actually prejudices them.