Trigger based de-risking is the hot topic in the pension world at present. Not de-risking now could mean a long wait for another opportunity. Are you in a position to take action?
PF Risk Report
A monthly report on the DB pension risk exposures of the FTSE100
It’s time to understand the risk.
For several years the media and the industry have focussed on deficit numbers but we believe the real issue is the volatility that sits beneath the headline deficit numbers. In publishing the PF Risk Report we are hoping to shift the debate to the far more important issue of risk.
Calculated using value-at-risk methodology and publicly-available data, the PF Risk Report is the first report to regularly quantify and provide a forward-looking view of the risk inherent in the UK’s largest DB pension schemes.
The report breaks down the pension risk into key components including interest rate, inflation and equity risk. It also demonstrates the likelihood and magnitude of future deterioration or improvements in the pension schemes funding position.
Given that the funding position determines the amount of cash a company will need to contribute to its pension scheme – with a corresponding P&L impact – it is crucially important that companies understand and manage pension scheme risk with the same timeliness and discipline afforded to other major balance sheet exposures.
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