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Real estate allocations within retirement saving schemes

This call for research closed on 31 July 2012 and the content on this page is for information only

Over the ten years to 2010, Defined Contribution (DC) schemes’ share of UK pension funds is estimated to have risen from 3% to 40%, amounting by the end of the decade to in excess of £500 billion. This has been largely at the expense of Defined Benefit (DB) schemes. Confronted by increasing longevity, a changing regulatory environment and weakening of sponsor covenants, the majority of DB schemes are now closed to new entrants.

The shift to DC can therefore be expected to continue, and have a significant impact on asset allocation decisions. According to a recent report by the EDHEC -Risk Institute and sponsored by AXA Investment Managers, DC pension schemes are "under-diversified" and need to adopt asset-liability management strategies to tackle inflation and longevity risks.

Proposals are sought to research the impact this move might have on the way assets are allocated in pension funds. The Institute & Faculty of Actuaries (IFoA) is concerned about how the change will impact on overall exposure to equities, bonds and other investment options, whilst the Investment Property Forum (IPF), European Public real Estate Association (EPRA) and Association of Real Estate Funds (AREF) are particularly concerned to ascertain what might be the results of the DB to DC shift in terms of exposure to commercial property.

The joint sponsors wish the study to focus on the following three inter-linked issues:

  1. The size of the current DC market; the decision-making process for the default option in DC schemes; existing (if any) allocations to real estate; and the role of investment consultants in determining asset allocations.  This paper will feature a survey of representative UK DC schemes.
  2. Expected changes to the overall retirement planning and savings market in the UK, including the impact of demographic and regulatory changes on the schemes provided.
  3. Subject to the conclusions of 1) and 2) above, how real estate in its various forms can successfully be incorporated into DC and other pension schemes, or vehicles that can be used for retirement savings, particularly given the liquidity requirements of DC platform providers, and taking into account tax considerations.  

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  • The Great Risk Transfer – Breakfast briefing and launch event

    Staple Inn Hall, High Holborn London WC1V 7QJ
    31 January 2019

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    Launch of the IFoA’s 2020 thought leadership campaign The Great Risk Transfer. The campaign will examine the trend of the transfer of risk from institutions to individuals, and how people can be better equipped to manage the financial risks they now face. At this breakfast event the IFoA will launch a call for evidence on this topic.

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    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    9 December 2019

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    9 December 2019

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    Staple Inn, High Holborn, London WC1V 7QJ  
    10 December 2019

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    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020.  The content and discussion at this session is particularly tailored to actuarial students and newly qualified actuaries working in any area and the format is interactive, so you should come along prepared to take part in the discussions with your peers.

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    12 December 2019

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    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    6 January 2020

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    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    7 January 2020

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    Patrick Lee is an actuary who has made the transition to working in software architecture and artificial intelligence (AI). He holds Microsoft Professional qualifications in Data Science, Big Data and AI and is currently working towards a DevOps (the automation of software testing and deployment) qualification. He is a member of the IFoA Council and is also President of the Wessex Actuarial Society. He is also a member of the IFoA and the RSS's joint Data Science Focus Group and will talk on the ethical use of AI. 

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    The presentation is provided by James Sharpe who has worked on a number of matching adjustment calculations with several firms.

  • IFoA Volunteer Recognition Reception

    Staple Inn, 4 High Holborn, Holborn, London WC1V 6DR, UK
    15 January 2020

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    As a thank you to all our Institute and Faculty of Actuaries (IFoA) volunteers, you are invited to join us at Staple Inn Hall, for an evening of drinks, canapes and networking, in London.

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  • Sessional Meeting - Operational Risk Dependencies

    Royal College of Physicians of Edinburgh 9 Queen St Edinburgh EH2 1JQ
    20 January 2020

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    The Operational Risk Working Party aims to assist actuaries and others in the modelling and management of operational risk. One of the key challenges in modelling operational risk is the modelling of dependencies between operational risks, and between operational and non-operational risks such as market, credit and insurance risk. Their paper seeks to assist in this regard, and help develop good practice in setting assumptions and modelling operational risk dependencies. 

  • KSS event in Glasgow: Public Sector Pensions

    Hymans Robertson, Glasgow 20 Waterloo St, Glasgow
    30 January 2020

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    Speaker: Allan Martin will present this talk on 30 January in Glasgow, Stirling and Edinburgh. If you wish to register for another location please return to the Events Calendar.

  • KSS event in Stirling: Public Sector Pensions

    M&G Prudential, Stirling Craigforth Campus, Stirling
    30 January 2020

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    – the unappreciated key assumption, the resulting unsustainable promises, the unmanaged risk and the unrecognised debt? 

    Speaker: Allan Martin will present this talk on 30 January in Glasgow, Stirling and Edinburgh. If you wish to register for another location please return to the Events Calendar.

  • KSS event in Edinburgh: Public Sector Pensions

    Hymans Robertson 1, Exchange Place, Semple St, Edinburgh
    30 January 2020

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    – the unappreciated key assumption, the resulting unsustainable promises, the unmanaged risk and the unrecognised debt? 

    Speaker: Allan Martin will present this talk on 30 January in Glasgow, Stirling and Edinburgh. If you wish to register for another location please return to the Events Calendar.

  • Professional Skills Training - London (11 February 2020)

    Staple Inn, High Holborn, London WC1V 7QJ         
    11 February 2020

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    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Sessional: Impact of E-cigarettes Working Party

    Royal College of Physicians, 9 Queen St, Edinburgh EH2 1JQ
    24 February 2020

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    This sessional meeting will be of direct interest to actuaries and others working in the in the Health and Care, Life or Pensions sectors or indeed actuaries with an interest in morbidity or mortality. Note: Registration is from 17.30 in time for the sessional to begin at 18.00.

  • Professional Skills Training - Edinburgh (25 February 2020)

    IFoA (Edinburgh), Level 2, Exchange Crescent 7 Conference Square Edinburgh EH3 8RA
    25 February 2020

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  • Spring Lecture 2020, Edinburgh - Vicky Pryce

    Assembly Rooms, 54 George St, Edinburgh EH2 2LR
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    Please join us on 25 March 2020 for our annual Spring Lecture presented by Vicky Pryce in Edinburgh. 

  • IFoA Asia Conference 2020, Kuala Lumpur

    CCEC Nexus, 7, Jalan Kerinchi, Bangsar South, 59200 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur, Malaysia
    24-25 June 2020
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    The sixth annual Asia Conference once again offers a prestigious line-up of home and international speakers discussing the insurance and financial industry’s innovation and change in Asia. This year's conference in Kuala Lumpur will be hosted by Tan Suee Chieh, IFoA’s first Asian President. He will also make his Presidential address at this conference and will expand on the important elements of IFoA’s new strategy. 

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