Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.
The defined contribution (DC) pension scheme landscape has seen much change in recent years.
There has been substantial growth in the asset base of DC pension portfolios. Since the “Great Moderation” ended, volatility has returned, obliging trustees to focus on diversifying risk for members at different stages of their journey.
This has driven increased sophistication in the asset allocations of DC pension portfolios. It means default funds are becoming more dynamic and more diversified. Private market investments are among the tools being used. This is a new area for the DC pension landscape, therefore understanding the tools at play is crucial.
The whole portfolio approach becomes more pertinent as trustees try to manage the varying risk exposure at each stage of the DC pension fund’s journey. It offers a consolidated view of exposures in a portfolio, including both public and private-market investments.
Learn why DC pension schemes are exploring this strategy and the benefits it can bring in the latest BlackRock PensionShip podcast, with Tim Hodgson, Managing Director, UK DC Platforms and Retirement Solutions.
