XPS Pensions Group: Fiduciary Managers struggle to deliver their performance targets

12 April 2019

XPS Pensions Group publishes on its website:

“XPS Investment has today published its first XPS FM Watch report in which they assess the growth portfolio performance and risk of Fiduciary Managers (FMs) following the worst year for financial markets since 2011. 2018 was a significant test for FMs with financial markets having their worst year since the financial crisis in 2008 and the stock market crash in 2011. As part of their report, XPS Investment has compared the growth portfolio performance of over 90% of the fiduciary management market and have found a wide range of performance outcomes for schemes in 2018.

FMs significantly underperformed their targets in 2018. Underperformance ranged from 6% to over 11%. Putting this into context, underperformance could have resulted in losses ranging from £4 million – £8 million for a £100million scheme with 70% exposure to growth assets. Longer-term performance of FMs is much stronger, but they still delivered a wide range of outcomes, with the difference between best and worst performance equating to 28% over a five year-period.”

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