- Asset management
- The benefits of Asset management
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Asset management plays a central role in the pension system. Pension funds are the most important clients of asset managers. Professional, cost-effective management of pension assets is crucial to the economy as a whole, and asset management is a vital contributor in this regard.
0.1% equals CHF 900 million
Achieving an optimal investment return is the main focus of every pension fund. The importance of professional asset management is illustrated by the following figure: by generating an additional annual return of only 0.1%, the Swiss pension system generates over CHF 900 million in additional income every year. Asset managers thus generate a substantial portion of our pensions and help to close pension gaps.
Operating framework for occupational pensions
An ideal operating framework is needed to ensure that occupational pensions remain on a solid footing going forward. In particular, pension funds need to be able to benefit from the full spectrum of investment opportunities with as few restrictions as possible. Experts agree that the current, rigid investment guidelines, which date back to the previous century, are no longer in tune with the times and fail to account for the fast-changing capital market environment. Relaxing them would probably have a positive effect on pension funds’ returns over the long term, making our pension system more sustainable.
To make sure that pension institutions can take full advantage of the entire investment universe, asset management companies and product providers need to improve their transparency. Less liquid investments in particular are still underrepresented in pension funds’ asset allocations because they sometimes lack sufficient transparency.
For pension funds to continue making the most of the scope available to them as regards managing their assets, attention needs to be paid to the ever-increasing demands in terms of risk management.