LD Pensions is responsible for the strategic and tactical management of the investments for both funds. Outsourcing is widely used in those areas where it offers economic and governance benefits.
The Board of LD Pensions has set out a number of objectives and principles that apply regardless of whether investment management is carried out within LD Pensions’ own organisation or by external asset managers.
It is essential that LD Pensions continues to be perceived as a reliable and competent manager of its members’/customers’ assets; this is ensured by investing actively with a focus on long-term value creation, whilst LD Pensions does not pursue ‘quick wins’. LD Pensions aims to generate returns that exceed the benchmarks set by the Board. Competitive returns are generated through active management within the defined risk and investment framework.
Two separate economies within a joint investment community
The assets of the Holiday Allowance Fund can be easily integrated into the existing investment structure. Furthermore, the two funds’ shared investment community ensures low costs and access to qualified investment advisers in all key areas.
The investment strategy for the Holiday Allowance Fund differs from that of the Cost-of-Living Allowance Fund. Apart from the fact that the time horizon differs for the two funds, the Holiday Allowance Fund also holds a very specific asset, namely holiday pay receivables, which remain with the employers. It is a safe asset, as the risk of loss is low, but it is the employers who decide what proportion of the assets is made up of holiday pay receivables.
