UK - Schemes can reduce risk and boost returns by investing in more flexible securities and using interest rate swaps, Britannic Asset Management claims.
The fund manager says portfolios that are actively managed with shorter dated assets will allow trustees the flexibility to alter their investment allocations in line with market fluctuations.
And combining this with interest rate swaps will allow schemes to better match their liabilities and reduce portfolio volatility, Britannic claims.
Head of institutional division Fiona Ross explained: “Trustees are increasingly looking for investment solutions aligned to their scheme’s specific needs. We believe the ability to use swaps alongside an actively managed portfolio of assets will be an attractive concept for many schemes.
“This approach retains the potential to add value through active management of the portfolio, along with the flexibility to adjust to changes in the liability assumptions in a timely and cost-efficient manner.”
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