Increased openness to wider pension investment strategies

More than a third (40%) of respondents are open to the idea of investing in new asset classes, according to research by Aon Hewitt.

The consultancy’s survey of more than 750 delegates at its annual pension conferences highlighted the increasing willingness of trustees to consider a wider range of asset classes for pension investment than has historically been the case within the industry.

It also found that there has also been a rise in the number of schemes seeking guidance from third-party experts on both how to assess and to access new asset classes and investment strategies with which they were previously unfamiliar.

Tim Giles (pictured), partner in the global investment practice at Aon Hewitt, said: “In the current hostile market environment, pension schemes are examining every opportunity to balance risk and reward in their investment strategy.

“The response we saw from the delegate survey at our conferences highlighted the increasing readiness that trustees and schemes are showing to investigate new opportunities.

“These seem to be taking various forms, including examining alternatives to traditional indexation approaches, accessing a wider spectrum of absolute return bonds funds or exploring better diversified hedge fund investments.

“As a consequence of this growing willingness to look at new options, some schemes are also strengthening their expertise in order to have a better understanding of the asset classes they are using, and this is reflected by the growing prevalence of fiduciary management.”