Key Takeaways
- • Aviva has launched a new defined contribution (DC) default investment strategy called "My Future Vision" that allocates 20–25% of employee pension assets to private markets, including private equity, infrastructure, and property.
- • The strategy represents a significant shift in Aviva's pension fund positioning, effectively doubling private markets exposure for DC pension participants who select this default option.
- • The allocation applies across the retirement journey, with the 20–25% range adjusted based on where a saver is positioned relative to retirement, reflecting life-cycle investment principles.
- • StepStone Group has been selected as a key partner to support the private markets allocation, broadening access to institutional-quality private market investments for DC pension schemes.
- • The initiative aligns with UK government policy encouraging defined contribution funds to increase allocation to private markets and domestic assets, positioning Aviva to capitalize on regulatory tailwinds in the pension investment landscape.
Summary
Aviva has introduced a new default pension investment strategy designed to substantially increase exposure to private markets for employees saving through defined contribution (DC) schemes. The strategy, branded "My Future Vision," allocates a meaningful 20–25% of pension assets to global private markets, encompassing private equity, infrastructure, and real estate holdings.
This represents a material expansion of private markets exposure within Aviva's default pension offerings. The allocation structure is dynamic, adjusting the 20–25% allocation based on the individual saver's position within their retirement timeline, reflecting standard life-cycle investment approaches that typically reduce risk exposure as participants approach retirement.
Aviva has partnered with StepStone Group to implement the private markets component of the strategy, leveraging the manager's expertise to provide institutional-quality private market access to what is typically a retail pension investor base. This partnership broadens the practical feasibility of implementing meaningful private markets allocations within DC default schemes, which have historically faced liquidity and complexity constraints.
The initiative reflects alignment with UK government policy initiatives that have actively encouraged DC pension funds to increase their allocation to private markets and UK-based assets. By positioning My Future Vision as a default option, Aviva addresses both regulatory encouragement and investor demand for enhanced return potential in a persistently low-yield environment, while potentially capturing increased assets under management as workplace pension participants adopt the new default strategy.
This represents a material expansion of private markets exposure within Aviva's default pension offerings. The allocation structure is dynamic, adjusting the 20–25% allocation based on the individual saver's position within their retirement timeline, reflecting standard life-cycle investment approaches that typically reduce risk exposure as participants approach retirement.
Aviva has partnered with StepStone Group to implement the private markets component of the strategy, leveraging the manager's expertise to provide institutional-quality private market access to what is typically a retail pension investor base. This partnership broadens the practical feasibility of implementing meaningful private markets allocations within DC default schemes, which have historically faced liquidity and complexity constraints.
The initiative reflects alignment with UK government policy initiatives that have actively encouraged DC pension funds to increase their allocation to private markets and UK-based assets. By positioning My Future Vision as a default option, Aviva addresses both regulatory encouragement and investor demand for enhanced return potential in a persistently low-yield environment, while potentially capturing increased assets under management as workplace pension participants adopt the new default strategy.
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