Prohibited investments

(1) An administrator shall not invest the assets of a pension fund in or engage in practices involving– (a) derivative securities; (b) securities purchased on margin; (c) venture capital; 50 Private Pensions (d) limited partnerships; or (e) short selling. (2) Exchange traded closed ended funds, pooled funds or open ended mutual funds are exempt from the prohibition in paragraph (1)(a) provided that such derivatives are used to reduce currency risk and interest rate risk only. (3) Risk reduction for a specified investment or set of investments shall be limited to the amount of the pension fund’s holding in that specified investment or set of investments. (4) For the purposes of this regulation“venture capital” means investment in a company or undertaking with unlisted securities or which recently has been formed, with a view to providing finance for the development or expansion of that company.