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Investments The money paid into the scheme is invested by different investment managers across different ‘asset classes’, so for example company shares (equities), and fixed-interest investments (bonds and gilts). The money paid in on behalf of members of the Grattan and Freemans sections is held in a pool (one for each section) from which all benefits are paid. Money Purchase members have their own individual retirement accounts in the scheme and use their pot of money to buy ‘units’ in different investment funds. 6 Hands off ! The assets in the scheme are kept totally separate from the company’s assets New strategy to reduce risk in the pension scheme The trustees, on the advice of their investment consultants, have started to switch some of the assets that are held in equities (company shares) into corporate bonds and gilts. More details will be provided in next year’s newsletter. Bonds & gilts These are loans to companies or governments who need to raise money to finance projects. (Bonds issued and backed by the UK government are called gilts.) The amount of the loan is paid back on a specific date, and interest payments are made throughout the duration of the bond, giving a guaranteed stream of income to the investor. For index-linked bonds, the rate of interest is linked to inflation – so it increases when inflation is on the rise and decreases when inflation goes down.
Split of assets During the year under review, the assets of the three sections were invested in the following asset classes: 0 1000 2000 Grattan Section Money Purchase Section 0 1000 20 Freemans Section UK equities 28.6% Overseas equities 34.1% Fixed interest 17.7% Index linked 9.5% Property 10.1% UK equities 23.6% Overseas equities 34.5% Fixed interest 24.9% Index linked 6.8% Property 10.2% 0 1000 2000 3000 4000 5000 6000 7000 8000 UK & overseas equities 88.9% Index linked 8.9% Cash 2.2% 0 1000 2000 3000 4000 500 7
Page 1 and 2: Talking point Otto UK Pension Schem
Page 3 and 4: what’s inside Money matters 4 Inv
Page 5: Grattan Freemans section section £
Page 9 and 10: Credit squeeze? Equity markets perf
Page 11 and 12: (so you pay less tax), plus any mon
Page 13 and 14: However, three years is a long time
Page 15 and 16: And what’s more… Age Concern re

point Talking Talking - PRAG

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