Pension received by the pension on Thursday, October 3, 2024, along the dock of the British Deal.
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The rapid surge in the cost of borrowing in the UK this year has triggered a memory of the “mini budget” crisis in 2022. Shock the country’s pension fund Cause Emergency market intervention Bank of England.
However, this year, British pension providers not only avoid the recent fluctuations in government bonds, they have benefited from it, and even increased the so -called responsible investment (LDI) that previously caused this damage.
The yield of British bonds is called gold -plated, Jump to the highest level in decades The cooling earlier this month was almost as fast as it was. However, they still rise. After the British Minister of Finance Rachel Reeves, the gold -plated yield has been reduced Published a wide range of speeches It is promised to “further and faster” to promote British economy. At 11:50 am in London time, the entire yield reduced 3 basis points.
In September 2022, a large number of British debt sold out and reduced the asset value held by the pension fund The main investor of gold -platedAnd lead to the deposit of its LDI funds. These leveraged investment is usually used by pension funds to hedge for factors such as inflation and interest rate changes. The threat of the knocking effect of the margin appeal should push several defined welfare pension funds to bankruptcy.
Sale is The main packaging without funding tax reduction Prime Minister Liz Truss announced. These proposals are described as “mini budgets”, which announced the “mini budget” when Britain’s high inflation, rising interest rates, and economic stagnation. Market turbulence prompts the Bank of England to intervene Emergency purchase of long -term bondsLDI funds are particularly sensitive to debt. Central bank Later Many pension funds have closed for several hours.
Jason BORBORA-SHEEN, the investment group manager of the investment manager of the investment manager, said that when the price of bonds fluctuated, investors still suffered a short period of “post-stimulus”.
But CNBC and It is emphasized that in terms of volatility, the transformation of the British bond market is not close to the mini budget, and for several key reasons, the liquidity of pension funds is not only there.
“As usual business”
A factor that helps to maintain cooling of pension funds is related to a wider macroeconomic environment, especially because investors move higher in a higher trend in a higher trend because investors reduce interest rates this year. Gilling moves sharply in the release of specific data in 2025 inflation And the growth wage data in China and the United States, they also responded to investors’ reactions and influence on British fiscal prospects StimulusEssence
Simon Bentley, the head of the British solution customer investment portfolio of Columbia Threadneedle, said: “The market has not escaped.”
“There are no large amounts of technical things in the market that really cause some spirals, and the yield is only index level. This is very clear. What is it driven? This is a Hong and Hong and Monetary policy.”
“We call the capital as several investment portfolios. As far as I know, other managers will do it, but this has largely launched the standard process, the standard time range.”
In the UK’s largest private pension plan (USS) university retirement plan (USS), market observer also adopted the same calm position when the gold -plated output increased. USS management worth 77.9 billion pounds ($ 96.7 billion) assets, and its subsidiary USS Investment Management Limited decided where to invest in funds.
The USS spokesman said in an email comment: “Here are many things for us.”
They pointed out that Trus’s mini budget is a catalyst for rapid markets and large -scale transformations, and the current price rise is carried out for a longer period of time.
It helps to avoid other key differences in the British private sector defining benefits (DB) funds-have a high funding rate since 2022, lower leverage and improvement of governance models. Workplace pension.
“After the LDI crisis, the pension plan now has a higher mortgage buffer and can withstand at least 3 % of the actual yield. Compared with 1 % in 2022, this is Britain’s largest company database plan.
“(Also during the LDI crisis, the yield rate is also higher.
Borbora SHEEN, a ninety -one person, pointed out that British pension regulatory agencies propose higher buffer restrictions after 2022, which means that if the yield rises rapidly, the “doomsday cycle” will no longer occur. He added that at the same time, the distribution of pensions in the pension fund had declined, and Bank of England showed that he was willing to interfere with the market and provided a sense of comfort.
High yield
Simon Bentley, Simon Bentley, at Simon Bentley at the COLUMBIA Threadneedle, said that the higher yield rate is actually a “good opportunity for pension planning”.
He said: “Rising yields, falling gold -plated prices, in fact, the level of funding planning is very positive.”
Ben Tele said: “The better the funding level, you need to be distributed to growth assets because you don’t need excess returns.”
“Therefore, in the past two years, not only from the perspective of risk management, the leverage rate has not only reduced … but also the pension plan does not require leverage, because they have received better funds.” He continued to say that when the market is the market When migration, this also improved stability.
“Several plans have just filled their mortgage pools and will be planned for a period of time. However, in fact, it is interesting that many pension plans have made more LDIs later. Higher rate of return.
He said that for a plan that may have reached 85 % to 95 %, the increase in yields is “a good opportunity that can rise at a good price.”
AQIB merchant, trust manager of Russell Investment, Write in notes on January 9th “The higher yield can ultimately enhance the long -term financial recovery power of the (pension) plan, but the premise is that it plans to take appropriate strategic decisions to lock these favorable positions, and then return to the lower level you have seen in the past.”
However, although a high yield has provided more attractive pension funds for locking, these funds have improved in recent years, and Pensions Advisory XPS Group chief investment officer Simeon Willis.
“We can’t see the wholesale changes of the planned hedge … we will not see a wall to promote it.”
“In fact, when issuing gold plating, this actually brings some problems (British Debt Management Office), because from history, the plan is usually increased, which means that when they issue new gold plating when they issue new gold plating plating , They have to surpass the gold plating of the new gold plating.
“But now you already have a pension plan. These plans do have all the gold plating they want. Therefore, unless they replace gold -plated, they really don’t need to buy new gold plating … they just trades a little trading in them in them in them. In the investment portfolio.
