The Merseyside Pension Fund has selected Schroders Solutions to implement a £3.8bn (€4.6bn) equity protection strategy.
Schroders has collaborated “extensively” with Merseyside since its appointment by the Northern LGPS framework to design a solution that aims to safeguard the scheme’s equity portfolios from any downturn ahead of its triennial valuation in 2025.
The strategy enables the scheme to maintain its equity exposures in order to meet its long-term performance objectives, while effectively managing downside risk.
It also provides support for the fund’s private asset positioning, ensuring a balanced allocation between liquid and illiquid exposures even in the event of a sell-off in listed markets, the manager stated.
Schroders has noted that the current market dynamics and solution design created a “prime opportunity” to implement the protection strategy in a cost-effective manner.
Peter Wallach, director of pensions at Merseyside Pension Fund, said: “We are very pleased with the advice and support of Schroders Solutions in working with us to implement an equity protection strategy that aligns with changes to our investment strategy and provides some stability in the funding level ahead of next year’s actuarial valuation.”
James Barham, executive chair at Schroders Solutions, added: “We are delighted to have been selected to work with Merseyside on this important project. Developing innovative solutions that work in partnership with the scheme’s investment strategy is one of our core competencies and we look forward to developing our relationship over the coming years.”
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