Active management strategies will be vital to DC pensions by 2012

More than three-quarters (76%) of pension groups believe active management strategies will play a ‘significant’ or ‘vital’ roles in their defined contribution (DC) pension schemes by the time the national employment savings trust (Nest) launches in 2012.

According to research by Clear Path Analysis, which was conducted among more than 50 of the UK’s largest pension schemes in preparation for the upcoming online report, New Active Management Solutions for DC Pension Schemes, †41% of pension trustees also felt active management would face significant hurdles in gaining the full support of other pension trustees.†

In addition, 53% of UK pension groups felt they spent too little time developing their DC schemes where a legacy DB scheme still existed; while 64% felt unsure whether target date funds were suitable for the UK pensions market.

Noel Hillman, managing director of Clear Path Analysis, said: “Originally, we found pension trustees showed mixed interest and concern for active management solutions for DC schemes.†

“However, the recurring comment was that DC was coming of age and active management with its innovative and original approaches to investment would drive greater investment choice which near all felt was a positive development.”

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