Opportunity and recovery: potential next steps for DB pension plans

investment viewpoints

Opportunity and recovery: potential next steps for DB pension plans

Ritesh Bamania - Directeur des Solutions

Ritesh Bamania

Directeur des Solutions

The ongoing COVD-19 pandemic has created an uncertain economic outlook. However, this may be an opportune moment to make careful adjustments to investment strategies.

Negative earning revisions have been experienced in many markets around the world and investment markets have taken a big hit as a consequence of COVID-19. At this point in time, it is not clear whether we have reached the bottom on what we are experiencing in terms of a market shock, nor is it clear what form the recovery may take. Making large changes to investment strategies in the current environment may seem counterintuitive. However, lessons from the 2008/9 financial crisis show that small changes at such a time can have massive benefits.

At a time like this, it becomes crucial to balance the need for return whilst reducing the potential for further downside risk. The two themes that we focus on are opportunities and ideas to capture market recovery (whilst continuing and/or enhancing risk management to avoid impact of any further falls).

Many pension schemes are very busy grappling with ensuring that normal service in areas such as payroll, new retirements, and transfer values is maintained. However, investment- related actions at this juncture are more important than ever. There are a few points for pension schemes to consider that we believe can truly help to manoeuvre through such challenging times and these are explored in our latest white paper.

Lombard Odier Investment Managers has the fortunate position of being invested across a wide range of asset classes and regions. If there are any questions or issues you are facing with your investments, and would like an informed opinion from one of our investment teams, then we would be happy to provide any assistance we can.

 

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