MLIM launches portable alpha for pension funds
UK - Merrill Lynch Investment Managers says it has launched a so-called "portable alpha" solution for pension fund clients, offered via a Jersey-based pooled umbrella vehicle.
It said the range, dubbed Merrill Lynch Liabilityplus, was "particularly appropriate for clients who have been looking to switch from equities into bonds but are concerned that they may lose upside from any potential equity upturn and/or cannot afford to lock in deficits".
"These funds offer an alternative option, seeking to deliver a level of performance similar to equities whilst offering a much lower level of liability risk, similar to bonds.
"This would enable clients to reduce their funding risk (the risk of not being able to meet liabilities) but without the increase in cost normally associated with selling equities."
"Through our Liabilityplus fund range MLIM can target a wide range of performance requirements for clients, whilst removing equity market risk and increasing diversification," said Andrew Dyson, head of institutional business.
"Offering this solution via a pooled fund range we believe is unique and has the distinct benefit of removing the administrative burden from pension schemes that otherwise would need to worry about operating legal contracts and counterparty agreements.