BRENTWOOD, England — Ockham Pension Scheme hired Schroders to manage its £80 million ($143 million) pension plan in a liability-driven mandate. Sixty percent of plan assets will be invested in growth assets, including public and private equity, property, hedge funds, high yield and emerging market debt, according to a statement issued by Schroders. The remaining 40% of assets will be invested in a portfolio that will use swaps to match assets to liabilities. Schroders will hedge up to 33% of the plan's interest rate and inflation risk using swaps. Over time, this hedging strategy will be increased to achieve full protection against risks from rising interest rates and inflation. The overall annual target return for the plan is 7%, said Phil Irvine, director of the scheme's consultant, Liability Solutions.
Aberdeen Asset Management, which had managed the assets, was terminated in March for performance and because plan trustees wanted to use an absolute-return strategy, said Ross Dunlop, a plan trustee. A spokesman at Aberdeen said the company would not comment. The scheme's previous allocation was 80% equities and 20% bonds.
The Ockham plan was closed to new members in 2001 and covers employees of U.K. insurance company Highway Insurance PLC, Brentwood. Actuary Hamish Wilson and Liability Solutions advised.