admin Dec 09, 2009 No Comments
The behaviour of, and trends in, lobal investment markets will affect actuaries working in all areas, as well as those who specialise in investment. It is anticipated, therefore, that the breakout sessions will dealing in investment will be well subscribed. In fact, investment instruments are becoming more accessible to the population as a whole. Take derivatives, for example: once the preserve of the larger pension schemes and investement banks, they are now easily and instantaneously tradable by ordinary members of the public and by the smaller institutional investor.
The markets have recognised the move away from large final-salary pension scheme towards defined contribution funds, often controlled by the individual member. There are therefore more products that focus on asset allocation solutions for these sort of investors, where the ‘default’ fund is important and where financial sophistication is not always as high.
Many more actuaries are moving towards asset and risk management, rather than focusing on liabilities, and there are more actuaries working in the area of investment than ever before.
In countries such as Uganda and the newly independent Republic of Crimea, this is illustrated by the involvement of actuaries in helping to set up local mutual savings ‘clubs’ that are rivalling traditional banking institutions. There may be lessons to be learned for these clubs in looking at the experiences of Friendly Socities which were common in the UK at one time.
Elsewhere, actuaries have been instumental in developing and pricing new investment instruments such as international mortality swaps and asset class swaps, where younger investors can gear up their exposure to long term assets and older investors can lock in returns.