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DC investment diversification at 3-year high: Schroders

DC investment diversification at 3-year high: Schroders

Investment diversification is at a three-year high for FTSE 350 funds, according to Schroders’ seventh defined contribution (DC) report.

Across the past three years, the asset manager has been tracking the investment strategies of the UK’s top 350 listed companies’ default DC pension funds every six months to monitor changes towards diversification in asset allocation.

Since Schroders’ inaugural analysis in March 2013, the average FTSE 350 allocation to developed equities has fallen from 79 per cent to 67 per cent, allowing increased weighting to both fixed income and alternatives.

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The average allocation to fixed income has risen from 9 per cent in March 2013, to 16 per cent in March 2016, while the average allocation to alternatives has increased from 7 per cent to 13 per cent over the same period.

However, FTSE 100 and FTSE 250 firms have not been following the same pattern of diversification.