Occupational schemes under fire

research suggests largest uk schemes are over-confident in their investment strategies

The majority of UK occupational schemes hold less than half of what they should have in bonds to create a properly diversified portfolio. The average occupational pension scheme has just 27% in fixed interest despite recent equity market weakness, research by Pricewaterhouse-Coopers (PWC) revealed. John Shuttleworth, a partner at the PWC, said while the least risky pension portfolio is actually about 90% in fixed interest, rather than 100%, the optimum allocation is around 75%. "In effect, while risk does reduce beyond 75% in bonds, the reduction is often marginal and may not justify ...