All interest rates articles – Page 9
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News
Saul: convertibles could spread as schemes look to reduce volatility
Saul's outgoing chief executive has predicted that its use of convertible bonds to dampen pension fund volatility could catch on at other schemes, but some advisers remain sceptical of the benefits offered.
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Features
Diageo tips into matching assets after hitting trigger
Diageo Pension Scheme has switched 5 per cent of its assets from its growth to its matching portfolio after hitting a derisking trigger, tipping its investment balance towards holdings that track liabilities.
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Opinion
So, what should pension funds expect from a BoE rate rise?
Editor's comment: The answer may not be as simple as higher rates mean a better times for UK schemes. But it cannot be much worse than the pain of the past few years.
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News
Interest rate uncertainty a concern for employer covenants
Interest rate rises could have a negative effect on covenant strength as some companies are forced to refinance at higher rates, advisers have said, and trustees should keep a watching brief to mitigate any resultant impact on their sponsors' ability to pay scheme contributions.
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Features
EE closes scheme to future accrual on affordability concerns
Telecoms company EE has closed the defined benefit section of its scheme to future accrual in order to equalise benefits offered to members in a structure which will be more sustainable for the company.
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NewsReturning volatility could threaten illiquid fixed income holdings, experts say
Pension scheme investors holding illiquid fixed income assets should beware the effects should increased volatility in global financial markets return, bond experts have urged.
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News
Schemes face LDI rethink to meet Emir collateral demands
Industry experts have warned that schemes using liability-driven investment strategies may face higher costs and additional risks when the European Market Infrastructure Regulation’s collateral diversity requirements come into force.
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News
Synthetic equities see interest as schemes look for creative ways to derisk
Defined benefit schemes are showing interest in synthetic equity strategies in order to move cash from growth portfolios to liability-matching strategies in an effort to shore up funding levels.
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Opinion
How to protect your scheme from rising interest rates
Bank of England interest rates have remained at half a per cent for more than five years now. Other central banks have also held rates at 'emergency' levels for similar periods of time.
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Opinion
How to build your risk committee
As more defined benefit schemes follow a derisking plan towards their end point, monitoring and managing risk grows ever more important.
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OpinionThe risks and returns in your EMD portfolio
Short-term losses, medium-term gains. The graph at the bottom shows the returns of 20 EMD funds held by UK pension schemes, and the recent story of the asset class is clear to see.
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Opinion
The crucial risk factors influencing your hedging decision
Interest rates are anchored at extremely low levels, reflecting monetary easing measures undertaken by central banks globally.
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News
United Utilities ups interest rate hedge after hitting trigger
United Utilities has increased interest rate hedging in its defined benefit schemes in order to reduce risk, working towards its target of full protection against interest and inflation rate fluctuations.
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Opinion
Concerns of rate rises is putting schemes off LDI
Is lack of understanding holding scheme back from liability-driven investment derivative strategies? Yes – but not in the way you might think.
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News
Scheme grabs chance to hedge inflation risk
Marsh & McLennan Companies UK Pension Fund has increased its interest and inflation rate hedge for its defined benefit scheme, to help protect its funding position against fluctuations in rates.
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News
Schemes grab chance to fireproof against inflation
Nearly half of pension fund trustees have incorporated longevity or swap contracts to tackle inflation risk, an upcoming survey will show, having benefited from favourable pricing last year to boost protection.
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Opinion
How real assets fit into your inflation battle
‘Uncharted territory’ is the common presage increasingly heard across the industry whenever inflation and pensions are uttered in the same breath.
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FeaturesCadbury hedges fifth of assets to manage risk
Cadbury Pension Fund has decided to hedge approximately a fifth of its assets to manage the impact of interest rate and inflation changes on its pension promises.
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FeaturesWHSmith doubles surplus through LDI hedging
The newsagent’s pension scheme has managed to double its accounting surplus through its liability-driven investment strategy, following continued low interest rates.
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Features
Achieving fixed price key to Arnold Laver buyout
Timber firm Arnold Laver secured a fixed price for its £45m buyout thanks to an enhanced transfer value (ETV) exercise and a long-term strategy of hedging risk.