Firms Release UK DC Index Series

A news release from the two companies said the index series brings to the market a set of tools to aid objective measurement of the performance and risk profiles of default strategies in UK DC plans.  Using FTSE’s index design standards and PensionDCisions’ data, the family of indexes reflect the actual asset allocation decisions made by plan sponsors, trustees, and their advisers and the subsequent outcome default solutions delivered to consumers, the companies said.

The indexes are designed to reflect various points in the life cycle of a DC member’s pension from the growth phase, through de-risking and at retirement. The series includes:

• Saving for retirement – Growth Index
• Approaching retirement – De-risking Index consisting of three target-dated indices
• Point of retirement – At-retirement Index

Tony Raw, Managing Director Europe at FTSE Group said, “The launch of these indices come at an exciting time for FTSE, as it rapidly evolves its index offering and brings an all important transparency to the DC market.”

The index series is suitable for the formation of index tracked funds and as an independent measure to support design and governance discussions between plan sponsors, trustees, advisers, and providers, the announcement said.