The Transport for London (TfL) Pension Fund has appointed BlackRock to manage a liability-driven investing (LDI) mandate and passive equity portfolios totalling £3.8 billion (€5.2 million) in assets.
The fund has over 82,000 members that work in London’s transport services and assets of £7.3 billion as at March 31, 2014. Assets are invested across multi-asset index strategies, enhanced index funds, bonds, global equities and alternatives.
BlackRock says the £1.6 billion LDI mandate will include measures to protect the fund from market uncertainties, including inflation as well as interest rate and equity volatility, whist having measured exposure to risk to achieve excess positive returns.
The fund’s £2.2 billion passive equity exposure will include investments across a range of index funds. The primary objective is for the fund to hold sufficient assets to meet its member liabilities.
In March last year, the TfL fund invested an initial £100 million into BlackRock’s Renewable Income UK Fund that invests in onshore wind, offshore wind and solar projects. The investment was part of a strategy to introduce new asset classes into the fund’s alternatives portfolio.
Stephen Field, fund secretary at TfL, says: “We have a duty to our fund members to ensure we employ the best investment solutions and consider all possible market risks and opportunities.”
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