Best Pensions Paper 2020 (North America)

MFS Investment Management wins Best Pensions Paper 2020 (North America)

Bouts of equity market volatility have affected solvency ratios significantly during 2020, and consequently, highlight the growing attraction of Target Date Funds as one potential solution to counter periods of market turbulence. MFS Investment Management's winning paper looks at how fixed income allocations grow and evolve along the retirement savings journey as equity allocations decline. The paper outlines fixed income allocations within target date funds, and suggests that plan sponsors ensure that exposures within TDFs are properly diversified.

WINNING PAPER: MFS INVESTMENT MANAGEMENT

Rethinking the Role of Fixed Income in Retirement Savings (MFS Investment Management)

While a typical retirement glide path illustration focuses upon declining equity allocations over time, this paper focuses on the opposite side of the same coin, illustrating how fixed income allocations grow and evolve along the retirement savings journey. It also describes fixed income allocations within target date funds, advising plan sponsors to make sure that exposures within TDFs are properly diversified.

HIGHLY COMMENDED PAPERS

The Forgotten Participant: Examining participant investment decision-making (Invesco, 2020)

For compliance reasons, this paper is only accessible in the United States

This Invesco study describes the behavior (and investment choices) of U.S. defined contribution plan participants. Many are not using target date funds correctly, or are allocating across these funds and their core menu in an inefficient manner. They use this research to develop several guidelines for plan sponsors surrounding investment menu design.

The World's Largest 300 Pension Funds (Thinking Ahead Institute, 2020)

As of the end of 2019, the world's 300 largest pension funds had over USD 19.5 trillion in assets under management (up around 8% from the previous year). This annual study contains a wealth of information about the characteristics of these assets, including breakdowns by country, by asset class, and by type of pension fund.

How do Private Equity Fees Vary Across U.S. Public Pensions? (HBS, 2020)

For compliance reasons, this paper is only accessible in the United States

As it turns out, terms play a significant role in the net-of-fee performance figures for public pensions, even when investing in the same private equity fund. The authors provide insightful analysis into pension size, governance, and the relationships that pension plans build with fund managers and consultants over time in order to attempt to level the playing field.

U.S. DB Pension Capital Market Assumptions Survey (Horizon Actuarial Services, 2020)

For the benefit of pension trustees and investment professionals, Horizon Actuarial Services provides this survey of capital market assumptions for multiple asset classes. This survey includes responses from 39 advisory firms and asset management companies within the investment industry, also providing scatter-plots and an analysis of historical expected returns for both short (10-year) and long (20-year) time horizons.

The New Social Contract: Achieving retirement equality for women (Aegon)

The gender pay gap makes it more difficult for women to save for retirement. On top of this, women who take time out of the workforce to fulfill parenting or caregiving responsibilities often fall even further behind when it comes to retirement planning. In this report, Aegon presents the findings from their Retirement Readiness Survey, while also providing recommendations for women so that they can improve their saving and investment practices and hopefully prepare more adequately for a secure retirement.

 

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ABOUT THE SAVVY INVESTOR AWARDS

The Savvy Investor Awards celebrate the best content from across the global institutional investment industry. We present awards across 14 different categories including the best overall paper.

Every year our Content Team handpicks and uploads over 10,000 articles and papers to the Savvy Investor platform. This library, alongside engagement data from 50,000+ members, means our judges are well-placed to identify and assess the award-worthy papers of 2020. The Awards are judged on many elements including the depth, quality, readability, and of course, appeal and relevance to our institutional investor audience. In a world saturated with content, and where it’s difficult to cut through the noise, it is a great pleasure to reward quality, cutting edge, and deeply engaging thought leadership to the investment community.

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