Investment strategies altered to cope with pension changes, says body
With the changing landscape of the UK pensions industry, private sector defined benefit (DB) schemes are changing their investment strategies in a bid to cope with rising costs and associated risks.
This is according to the latest yearly survey of 321 pensions schemes by the National Association of Pension Funds that discovered that despite the closure of many such schemes, a third of them remain available to new employees.
But managers of DB schemes are changing the way they invest in order to cover potential risk and the reality of rising costs.
The National Association of Pension Funds survey discovered that during 2006, nearly a third of DB schemes upped their investment in fixed assets, with almost one in five investing in property last year.
Hedge funds were the investment vehicle of choice for eight per cent of DB schemes, while seven per cent opted for venture capital or private equity investment.
Joanne Segars, National Association of Pension Funds chief executive, said trustees are faced with a "difficult balancing act" as they attempt to juggle achieving the best possible returns with taking responsible risks.
She said many trustees are using "innovative solutions as they shape their investment strategy around the scheme's liabilities".
Investment strategies altered to cope with pension changes, says NAPF
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Investment strategies altered to cope with pension changes, says NAPF
Thu, 22 Feb 2007
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