Irish Life Investment Managers has launched a range of diversified funds which are of particular relevance to the Defined Contribution pension plan market.

This range of funds recognises the growing use of alternative asset classes within defined benefit pension plans and aims to provide access and liquidity to these asset classes in combination with more traditional asset classes such as developed markets equities, bonds, property and cash.

Within the range there will be a:-

Diversified Growth Fund which is aiming to deliver equity type returns but with lower volatility levels. The types of asset classes being accesses within this fund are developed world equities, hedge funds, European property, high yield equity, emerging market equities, and commodities.

The Diversified Balanced Fund is aimed at the traditional balance/managed options. Again this fund will invest in developed world equity markets but deliver lower volatility than traditionally associated with balance funds by diversifying across such assets as property, forestry, high yield equities, commodities and hedge funds. However, the fund will hold a significant allocation to bonds c.20%. The bond allocation will be a mixture of inflation linked bonds and greater than 5 year bonds.

The Diversified Cautious Fund is aiming to avoid negative returns over a rolling 3 year periods. By investing predominately in bonds (32.5%), property (16%) and Cash (10%) and then investing in assets classes with low levels of correlation such as forestry, commodities and hedge funds we believe this offers a new option in the conservative fund range.

Accounting and Funding Standard Impact

The increased importance of contribution and solvency volatility on corporate balance sheets and profit and loss accounts (as determined by accounting and regulatory funding standards) is generally driving a diversification and de-risking agenda.

The tightening of correlations between regional equity markets has increased the volatility of pension fund returns thus threatening the objectives of trustees and sponsoring employers alike in satisfying these more rigorous accounting and regulatory funding standards and in improving the predictability of pension contribution demands.

To find out more please contact Irish Life Investment Managers on 01.7042414 or
Click Irish Life Diversified Funds - Brochure and further information for further information