Pension allergy to bonds - should it go on?

It seems like pensions are having an allergy to bonds. It makes perfect sense given the low yield levels and the current sell-off, but pension funds that move to greater equity holding have another problem. They will face greater uncertainty with their expected rate of return. Those expected rates of return have generally not come down, so there is a risk that pensions will not be able to meet their return targets. Of course, they would not have been able to meet their targets if they held low yielding bonds. This allergy to bonds will go on. Pensions are slow to react.

A bond allergy can lead to a greater pension sickness.