Daily policy initiatives by governments across the world who are desperate to avoid the worst ravages of an economic recession are fuelling a lot of the volatility in public markets with which investors are now sadly familiar. However, many pension funds have significant private market exposures through alternative investments. Those holdings are not immune to government intervention and pension funds should note the sometimes unexpected effect of policy changes.
The Pensions Regulator’s COVID 19 guidance on 27 March advised pension scheme trustees to “Review and manage specific risks which may now exist within their portfolios …eg concentrations of risk and/or exposures to deteriorating sectors/credits”.
This blog provides further detail on some emerging investment risks. Continue Reading