Nest will issue a tender for a pooled investment fund in an attempt to bolster its pre-retirement investment offering.
Nest says the fund will form a “building block” for the scheme’s retirement date funds and is likely to invest in a portfolio of bonds in order to track changes in annuity prices resulting from interest rate changes.
The pooled fund will be used predominantly in the final consolidation phase of members’ saving and will form part of the scheme’s pre-retirement fund.
Chief investment officer Mark Fawcett says: “We are engaging with providers of annuity tracking funds. At some point, we will add that to the pre-retirement offering.”
Bestinvest senior investment adviser Adrian Lowcock says: “As people move towards retirement, they want to reduce risk, so bonds are a natural type of investment to aim for.”
Nest chief executive Tim Jones also told Money Marketing this week that DWP secretary of state Iain Duncan Smith is recruiting additional trustees for Nest.
Jones says: “We are allowed between nine and 15 trustees. We have seven now and I would expect two or three more.”