UK - Britain's top 100 pension schemes have slashed their equity holdings by 15 percentage points since 2000.
IPN’s sister publication, Professional Pensions’ annual survey of the Top 100 schemes shows the average allocation to equities has dropped dramatically to 56.8%.
The figures for equities are lower than WM Company’s estimates at the end of last year which put allocation at 68%.
But Mercer Human Resource Consulting head of investment strategy Andy Green said the findings were in line with forecasts.
He said: “Three years ago, the average pension fund allocation to equities was 70% and it was predicted this would reduce by 5% per annum. The key decision for trustees was – and continues to be – whether they stuck with equities and moved up with the market in 2003 or, instead, decided to take the profits to invest elsewhere.”
The £1.75bn Philips Pension Fund had the lowest allocation to equities (21%) with the Royal Mail Pension Scheme topping the chart (80%). Other average allocations were bonds (28.8%), property (6.8%) and cash (2.09%).
A buyout tool which provides schemes with up-to-date pricing and comparisons between insurers has been launched by JLT Employee Benefits.
The DB white paper sets out plans to review the funding regime, with 'prudent' and 'appropriate' possibly redefined. But James Phillips asks if this could this signal a return to an MFR-like approach?
The trustees of GKN's pension schemes have agreed a package of mitigation measures that would improve funding to a "more prudent level" if Melrose's offer is accepted by shareholders next week.
While the new powers are welcome, most respondents doubt it will make a difference to the outcomes for members, Pensions Buzz respondents say.