GLOBAL - Consultants and fund managers are urging pension schemes to invest in emerging market equities.
Watson Wyatt says that although many pension funds have serious reservations about the asset class, there is a valid argument for investment as the funds are relatively cheap.
It said emerging market funds can provide strong diversification benefits as part of a global equity portfolio as the potential for growth remains strong.
State Street Global Advisors added: “Eastern Europe remains healthy with the Russian economy performing nicely. Russia’s credit rating has been pushed up to double-B-minus, making it consistent with recent assessments.”
It said Asia remains the most prosperous region in the emerging world as growth in China continues and domestic activity in Korea, Thailand and Malaysia.
Brazilian markets are still in “disarray” with bond yields surging and the currency plummeting.
Businesses are experiencing auto-enrolment data error rates of up to 50%, posing questions over the reliability of pension records, Pensionsync says.
UK inflation unexpectedly rose to 2.7% in August, beating analysts' expectations of a drop to 2.4% from 2.5% the previous month.
The Pensions Advisory Service (TPAS) helped 187,000 people in 2017/18, a 9% fall on the previous year despite setting up special helplines for specific scheme members.