PTL Blog

Costs, charges and the highest quality

Posted by Colin Richardson on Oct 5, 2017 3:18:39 PM

First published in Pension Funds Online, 13 April 2017

Colin Richardson discusses the importance of quality and getting value for money.

The terms "value for money" – monitored by IGCs for workplace pensions – and "good value" – assessed by trustees of occupational pensions – are not defined in legislation.

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Topics: investment management, investment, value for money, investment transaction costs, Tranaction Costs

A Man Walks into a Bar

Posted by Richard Butcher on Aug 16, 2017 9:15:14 AM

First published in Pensions Insight, 15 August 2017

There is a common language when it comes to beer and bar snacks - we need the same for pensions.

A bizarre and weird thing happened to me the other day. I went to meet with someone I’d never met before, in a pub, not far from home. 

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Topics: Transaction costs, investment management, investment, investment transaction costs

Counterparties come to the party

Posted by Richard Butcher on May 24, 2017 11:22:00 AM

First published in Engaged Investor, 24 May 2017

Richard Butcher, managing director of PTL talks about his bugbear in any investment mandate but particularly a fiduciary one, that it is rarely clear who is involved.

I’ve got teenage kids and as a consequence, one of my recurring nightmares is the “facebook party”. You’ll have heard about these. Your teenage child asks “can I have a few friends round while you’re out on Saturday?” You reply, “Sure, but not too many and behave yourselves.”

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Topics: investment, fiduciary management

Increasing Deficits: A time to panic?

Posted by Richard Butcher on May 15, 2017 3:57:52 PM

Barely a month goes by without one of the trade papers publishing the headline that the combined pension deficit of the U.K.s largest companies has shot up/dropped (delete as appropriate) by some incredibly large number. The sensationalism of the headline will directly correlate with the number. This month those headlines were augmented by comments from Mercer suggesting that the recent slowing down of life expectancy improvements had wiped £2.5bn off the combined deficit.

Hmmm. It's time to pause for a moment and reflect on all this excitement.

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Topics: investment, Deficits

The investment costs map: below-the-line costs

Posted by Richard Butcher on Feb 21, 2017 11:42:44 AM

In my blog The investment costs map: where costs can occur in the investment processI described where and when pension investment costs can occur. In this blog, the third in the mini series, I set out what costs can occur “below the line”.

Firstly, a few things to remember from the first blog. The “line” is where the unit price is calculated. Costs that are below the line are implicit in the unit price (i.e. they are deducted BEFORE the unit price is calculated and so they are invisible to the consumer) and will not be contractually specific. Also, costs have both quantum and duration – different amounts at different times.

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Topics: Transaction costs, investment, cost transparency

The investment costs map: above the line costs

Posted by Richard Butcher on Jan 31, 2017 8:54:35 AM

In my blog "The investment costs map: where costs can occur in the investment process" I described where and when pension investment costs can occur. In this blog, the second in the mini series, I will set out what costs can occur “above the line”.

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Topics: investment, cost transparency

Are your pension scheme's contingent assets a "turkey"?

Posted by Keith Lewis on Jan 25, 2017 3:13:09 PM

In 2016 the Bernard Matthews pension scheme started heading towards the PPF. This followed a corporate takeover that excluded the pension scheme. Whilst the Bernard Matthews scheme had a charge over company assets, any asset recovery for the pension scheme is now expected to be minimal.

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Topics: investment, Contingent assets, asset manager

The investment costs map: where costs can occur in the investment process

Posted by Richard Butcher on Jan 19, 2017 7:51:58 AM

Tim Harford, in his book The Under Cover Economist, makes the point that it is very difficult to out-perform the market over the long term, and concludes his argument by writing: “we should gently invest in a wide variety of shares, with no expectation of making a killing – we should diversify, keep charges low and avoid trying to be too clever”.

Good advice, although, in one respect at least, difficult to follow. We can all agree that investment costs should be low (although they should be low and optimal, as opposed to low for the sake of it) but how can we be certain they are when they are so opaque?

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Topics: investment, cost transparency

The cost of being too clever

Posted by Richard Butcher on Jan 12, 2017 11:19:28 AM

Richard Butcher says it's time to learn that complexity is generally costly

My school teachers were okay, but in a lifetime of learning since then I’ve come across so many other people who would have been better. Imagine Jonny Ball teaching you maths, Bill Bryson history, geography or science, or Brian Cox physics. 

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Topics: investment, FCA, asset management

Charge cap guidance brings significant uncertainty around property investment

Posted by Richard Butcher on Oct 25, 2016 5:16:35 PM

Late last Friday, as many in the pensions industry tried to doze quietly on their trains after an exhausting but great PLSA conference, the Department for Work and Pensions (DWP) published some guidance on the charge cap that applies to qualifying DC schemes.  

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Topics: dc regulations, dc governance, investment, property

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