Councillors and committees

Issue - meetings

Investment Strategy Review

Meeting: 12/02/2019 - Pension Fund Panel (Item 37)

37 Investment Strategy Review -Bond Portfolio pdf icon PDF 63 KB

Representatives from the London CIV and CQS will be attending.

Additional documents:

Minutes:

The Investment Strategy review in September highlighted opportunities to enhance the funds risk-return profile by reallocating a proportion of the bond holding to a multi asset credit fund (MAC).  The London CIV now offers a MAC, the Manager is CQS a global manager with over $14 billion under management of which $5 billion is in MAC funds.

 

The current asset allocation of the fund shows that the bond portfolio is underweight at 12% against a benchmark allocation of 15 %.   Aon Hewitt’s bond portfolio review shows that reducing the Janus Henderson All Stocks Credit fund by around £32m and investing in the CIV MAC would lead to greater return and less volatility than the current Bond portfolio

 

Exclusion of Press and Public

It was Resolved to exclude the press and public from the meeting for the discussion on this on the grounds that it was likely that exempt information, as defined in paragraph 3 of Part I of Schedule 12A to the Act, would be disclosed and the public interest in maintaining the exemption outweighed the public interest in disclosing the information.

This paragraph covers information relating to the financial or business affairs of any particular person (including the authority holding that information)

 

Will McBean and Larissa Benbow from the CIV gave an overview on current developments at the CIV, the greater engagement with Boroughs   and the manager selection process.

They introduced Soraya Chabarek and Craig Scordellis from  CQS

 

Craig Scordellis the Fund Manager outlined the philosophy of the fund which is to preserve capital and avoid volatility.  There are a lot of challenges politically and economically but the fund adheres to the philosophy to return cash plus 4% - 5% with minimum volatility, focusing on the quality of businesses understanding regulatory changes and being in the right asset class or geographical area at the right time.  None of the funds’ investments represent more than 1.2 %.of the portfolio.

 At present whilst there are opportunities for investment, risks include the geo political situation and rate volatilities examples of the funds view of risk areas and those of opportunity were given.

 

Resolved that the report is noted and the proposal contained in Aon Hewitt’s review of the bond portfolio (exempt Annex 1) to re-allocate a proportion of the funds currently invested in Janus Henderson’s All Stocks Credit fund to the London CIV Multi-Asset Credit fund approved.