Aegon teams up with BlackRock for auto-enrolment investment range

Aegon has launched a new auto-enrolment investment range offering eight lifestyle funds for use as default funds.

The funds are offered through the provider’s Aegon Retirement Choices (ARC) platform.

The ARC default fund is a risk targeted diversified fund run by BlackRock that has active risk management built in.

Aegon says it has designed the range to reflect the fact that most employees are daunted by the prospect of investing and are concerned about their investments losing money if markets fall. The range includes a suite of risk-managed funds, Aegon’s Managed Intelligently (MI) Workplace Savings funds, each targeting different levels of risk.

The mid-risk version of this fund has been selected as Aegon’s new ARC auto-enrolment default fund. BlackRock has been appointed to manage these funds, which invest in a diversified portfolio of assets and incorporate Aegon’s lifestyling process.  

The three options allow UK employers to choose a fund with an appropriate level of volatility for their scheme, and an added layer of risk management that Aegon believes could help limit the impact of sharp market falls like those seen during the credit crunch. This overlay recognises a historic correlation between rising volatility and market falls, so moves some of the investment into safer assets like cash when markets become more volatile.

The ARC auto-enrolment range also includes four further lifestyle funds giving access to a mixture of passive and active investment strategies and various risk options based on traditional asset allocations.

Mark Pearson, head of investment marketing at Aegon UK says: “Via our ARC platform employers and their advisers can choose ‘off-the-shelf’ solutions that are designed to meet a range of risk appetites, either as scheme default or as part of their preferred fund range.”

Tony Stenning, head of BlackRock’s UK retail business says: “We have worked closely together to understand the requirements of Aegon’s clients and have constructed a range of three outcome-oriented solutions to reflect their varying risk requirements. 

“Designed specifically for Aegon’s auto-enrolment proposition, the three multi-asset funds are well-diversified across asset classes and geographies, providing access to a range of risk profiles. By offering diversified asset exposure and a more stable investment experience, we hope to encourage those saving for retirement to continue to build up their pension pot and feel greater confidence in investing.”