The Weekly Wrap: October 11 edition

UK slips down global pension league

FTfm: The UK has slipped to ninth place, from seventh, in the global ranking of countries’ ability to meet the retirement needs of their populations, according to the annual Melbourne Mercer Global Pension Index.

High hurdles for great rotation into equities

FT:  Morgan Stanley has predicted institutional investors are neutral on equities as there are significant structural challenges to a big switch into the asset class. “Defined benefit pension schemes are likely to reduce equity allocations as they derisk to better match assets and liabilities,” the asset manager stated.

Hedge fund fees remain a stumbling block for UK schemes

MandateWire: UK pension schemes accounted for just 20 per cent of hedge fund mandates awarded over the past year, according to data from MandateWire. “We are having more meetings and discussions with these types of investors, but many are still affected by what happened during 2008 in terms of liquidity issues, and also the associated industry fees,” says Alison Clark, head of hedge fund research at Hymans Robertson.

Iraq: can a dusty war zone become a golden opportunity?

FTfm: Investment in Iraq is on the rise despite its recent history of war and ongoing violence. Optimism has been driven by recovery in the country’s oil industry. “Corporate profits are booming despite the security backdrop. Can you imagine what will happen if things actually get better?” asks Sanjay Motwani, president and portfolio manager at Sansar Capital. 

US pensions are in a hole – and still digging

FTfm: US state and municipal pension schemes are unlikely to hit fully funded targets in the next 30 years, according to the Center for Retirement Research at Boston College. The report said increased contributions may not be enough and questioned whether the current retirement promises on offer were viable.

Most read on pensionsweek.com

Care UK sees 4% opt-out after comms barrage
Five questions to get value on manager fees
The Pensions Trust defends responsible investment policy
Is your scheme independence-proof?
Regulator refines website for SME auto-enrolment

This week's social media comment

In response to our story on Care UK's opt-out rate of just 3.8 per cent, Adrian Parker posted the following on Pensions Week's LinkedIn group: "This is really good and must be among the best I have seen to date, can you let me know more about the communications strategy used."

The scheme used a variety of communications which included used email, intranet, internal publications, employee forums, meetings with line managers and sessions with senior management.