Sources close to the agency that handles the pension fund for Japan's civil servants said the agency is mulling a change in its ultraconservative investment strategy. The Federation of National Public Service Personnel Mutual Aid Associations wants to make more of its US$80 billion fund available for investments in stocks and less for investments in domestic government bonds. The agency presently handles a pension fund that caters to 1.24 million active and retired public workers.

The agency's move follows a recent switch towards riskier investments by Japan's Government Pension Investment Fund, or GPIF.  Japan's GPIF is the world's largest pension fund with US$1.2 trillion in assets under management.

"The federation is expected to change the portfolio model that is heavily weighted to domestic bonds. It is considering revising its investment strategy in a way to take more risks, especially after the change by GPIF," said one of the sources in an interview with Reuters.