(Corrects from pension fund to sovereign fund in 1st graf)
SYDNEY, Feb 5 (Reuters) - Australian sovereign wealth fund, the Future Fund, said a dramatic fall in the local currency helped it return 13 percent in calendar 2014, as it moves to de-risk its portfolio to offset volatile commodity and equity markets.
The fund set up in 2006 to cover public servant pensions, grew by nearly A$13 billion ($10 billion) to A$109 billion by Dec. 31, partly by boosting cash to 12.8 percent of its portfolio from 9 percent a year earlier.
The fund reduced its investments in equities over the year due to increased market volatility, said managing director David Neal. Developed global equities were cut to 20.9 percent of the portfolio from 24.5 percent a year earlier, and Australian equities to 8.8 percent from 10.1 percent.
"For some time we have forecast (a scenario) where growth is somewhat subdued," Neal told reporters in a teleconference.
The performance, double the fund's 2014 target of a 6.5 percent return, is a bright spot in what has been a substantial reshuffling of Australia's economy following a commodities downturn that has stifled investment in the sector and a fall in the local dollar against the U.S. currency.
On Tuesday, Australia's central bank cut interest rates for the first time in a year-and-a-half, citing sluggish growth, falling commodity prices and global economic uncertainty.
As part of its de-risking strategy, the fund may buy stakes in some A$90 billion of Australian state-owned ports, electricity networks and other infrastructure assets that governments are hoping to sell in the next two years, Neal said.
"Australian infrastructure assets are attractive to us because we're an Australian dollar investor," he said.
"But we're not willing to buy the assets at any price. We'll remain disciplined," he added.
$1 = 1.2878 Australian dollars Reporting by Byron Kaye; Editing by Richard Pullin