Mobius Life introduces ‘Smart Rebalancing’ for DB pension schemes

Mobius Life has developed an innovative ‘Smart Rebalancing’ service, which automates the rebalancing process for defined benefit (DB) pension schemes, reducing risk and potential transaction costs.

Periodic rebalancing of a DB scheme’s assets to keep its overall portfolio in line with its chosen asset allocation and investment strategy is an essential part of keeping a scheme on its path.

Traditionally rebalancing has been a largely manual process for many schemes and their advisers. It also exposes DB schemes to potential expense and out-of-market risks of transitioning assets between funds.

Mobius Life’s ‘Smart Rebalancing’ service automates the process, reducing risk and potential transaction costs for DB schemes.

‘Smart Rebalancing’ utilises the scheme’s cashflows each month to rebalance the scheme towards its benchmark holdings. Mobius Life manufactures a blended fund for each scheme which reflects the liquid assets that would be included in the rebalancing process.

For cashflow-negative schemes Mobius Life rebalances as the scheme draws down cash, for example, to pay pensions each month; this is achieved by automatically ‘top-slicing’ the most overweight asset classes to pay benefits and bring the scheme back into line.

For cashflow-positive schemes, monthly contributions are automatically allocated to the most underweight asset classes.

Adrian Swales, Chief Executive Officer, Mobius Life said: “Smart Rebalancing fully automates an essential part of DB scheme management, bringing the process into the 21st century. It not only automates the rebalancing process but also significantly reduces the need for rebalancing at the quarter or year end. It also reduces risk and potential transaction costs for DB schemes.”

-ENDS-

For further information, please contact:
Mobius Life, Mike Lord
E: [email protected]
M: +44 (0)7831 401 311

Notes to Editors:
Mobius Life (www.mobiuslife.co.uk) is a UK life insurance company and institutional investment platform, established in 1996, with c. £20 billion assets under administration. We deliver investment administration and life company services to DB and DC pension funds, asset managers and other institutions. Mobius Life empowers investors to implement investment strategies efficiently in a cost-effective manner.

Mobius Life won the Institutional Pension Platform of the Year award at the 2019 Professional Pensions Awards.