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First Quadrant wins mandate with Associated British Foods

12 November 2012

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Investment firm First Quadrant, which specializes in dynamic asset allocation and optimal alpha strategies, announced that on of its funds has been selected by the Associated British Foods defined contribution (DC) pension scheme.

Associated British Foods is known for its household brands such as Twinings, Silver Spoon, Kingsmill bread and the clothes retailer Primark. Its DC pension scheme is £100m in size and the investments are administered on the AXA Wealth platform.

For its DC scheme Associated British Foods chose First Quadrant's Global Risk-Balanced Fund, which aims to improve the risk return profile of default fund options by diversifying risk more equally across global developed and emerging equity markets, global sovereign bonds, TIPS, commodities and real estate. Its goal is to balance risk as opposed to focus on the capital weighting of each asset class, an approach more commonly used by traditional diversified growth funds and balanced strategies.

Colin Hately, group pensions director at Associated British Foods, said: "As part of our preparation for auto-enrolment, we wanted to offer our scheme members a best in class range of investment options. The First Quadrant Global Risk-Balanced Fund provides members with an alternative option that aims to provide a balanced and stable return, which is reassuring for our members in today's volatile market environment."

Ed Peters, partner and co-head of Global Macro Strategies at First Quadrant, said: "Default funds are designed to offer a 'one size fits all' solution to scheme members. Many default funds have a disproportionately high allocation to equity and equity-like risk, making them more prone to market shocks. The goal of the First Quadrant Global Risk-Balanced Fund is to deliver stable returns by building a well-diversified portfolio that seeks growth while balancing risk, both across and within asset classes, and through time. We believe it is an ideal alternative fund option for members of the scheme who wish to have a more stable return profile."


First published 12.11.2012