In UK, Alternatives Rapidly Becoming Part of 401(k)s

A new report reveals that alterative investments have rapidly become a bigger part of the 401(k)s of UK workers over the last two years.

From Investments and Pensions Europe:

In its latest six-monthly FTSE DC report, asset manager Schroders said the pension schemes of companies in the FTSE 100 index had lifted their exposure to alternatives to 12% by March this year, up from 8% in March 2013.

Meanwhile FTSE 250 schemes had raised their allocation to the asset type to 9% from 5% over the same period, the study showed.

Exposure to developed equities, on the other hand, had fallen over the past 24 months, with FTSE 350 schemes’ exposure to these assets falling to 71% in March 2015 from 79% in March 2013.

Among FTSE 350 schemes, fixed income allocations had doubled to 14% from 7% over the period, with the bulk of this growth having taken place over the last six months.

Almost a third of schemes in the survey now had a fixed income allocation of at least 20%, whereas a year ago, this had only been true for 3% of schemes, Schroders said.

Read a Schroders news release on the report here.

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