Reducing implementation risk for pension consultants

12 May 2022

Craig Brown Institutional Distribution Director

Author

Craig Brown
Institutional Distribution Director

Craig Brown discusses how the Mobius Life platform can reduce implementation risk for pension consultants undertaking transactions for their clients.

We’re all in the risk business. Investment consultants devote huge amounts of time and intellectual prowess to delivering the right risk-rated returns for their clients. So why do some saddle themselves with unnecessary implementation and transition risk – when this could be taken on by the Mobius platform instead?

Let’s consider what happens when a consultant has two clients – one on the Mobius Life platform and the other directly invested with managers.
In this example, both schemes use a selection of fund managers and want to withdraw money to pay the transfers. The cash amounts required to pay these transfers are sufficiently significant for it to make sense for the withdrawals to be made to bring the portfolio in line with the benchmark asset allocation.

With the directly–managed scheme there is a lot to do. The consultant needs to contact all the managers for prices to calculate the manager allocations and then calculate the quantum of each withdrawal. They then need to complete the withdrawal paperwork, instruct all the managers, collate all the receipts and calculate the new asset allocations following the withdrawals.

This ‘low value’ task will probably take the consultant several hours to complete and leaves them exposed to execution risk. They will also rack up significant time cost - and all for an exercise seen of as having only modest added-value to the client.

In comparison, the other scheme is managed on the Mobius Life platform. Here the consultant simply sends Mobius one authorised instruction, which we implement and report back to them via a transaction statement and valuation. Simple, safe, cost effective and efficient.
The same is true for schemes looking to change strategy or transition from one fund manager to another. Work which can take several days off-platform is easily completed in ‘real time’ by using Mobius Life.

So, as part of all our jobs is to manage risk effectively - prudent schemes and consultants are reducing risk by using Mobius Life to deliver professional platform-based investment administration.

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