Hammersmith & Fulham award 'dynamic' mandates
UK - The London Borough of Hammersmith and Fulham has appointed two managers to run specialist dynamic asset allocation portfolios for its pension fund.
The £460m (€582m) pension scheme has split the mandate - valued at £120m - between Baring Asset Management and Ruffer LLP.
Baring Asset Management will be responsible for investing £90m of the assets, while Ruffer will manage the remaining £30m
Both firms were awarded the contracts on the basis of quality, technical merits and price, with the firms scheduled to begin the contracts on August 1 2008, after beating offers from around 50 other providers in a search conducted by bfinance.
Hammersmith & Fulham's pension fund investment panel first agreed to start the search process for a dynamic asset allocation manager in September 2007 as a way of diversifying away from its previous asset mix of 70% equities and 30% bonds.
According to the original tender notice BAM and Ruffer will be expected to provide a target return of 4% above the UK three-month London Interbank Offered Rate (LIBOR) over a rolling three-year period, with 5-10% volatility. (See earlier IPE article: Hammersmith & Fulham move towards dynamic asset allocation)
Meanwhile, Hammersmith & Fulham is also in the process of selecting a new actuarial services provider, with the successful applicant expected to begin the six-year contract on August 1 2008. (See earlier IPE article: Hammersmith & Fulham seek actuarial consultant)
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