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Thursday, 25 August, 2011 |
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This article describes how custody is not a risk-less activity and is critical to the proper functioning of funds, including pension schemes. Although custody is of great importance to the safety of invested assets, many investors do not fully understand the role of the custodian and the related risks that their fund and assets may be exposed to. Those funds that actively engage with their custodians, including the regular monitoring of their performance and costs, typically enjoy better value for money and are exposed to less operational risk than their peers.
This article was first published in the July edition of PMI News, the Pensions Management Institute's newsletter. Although the article refers mainly to pension funds, the issues discussed are equally relevant to other asset owners including insurance companies, sovereign wealth funds, investments trusts, mutual funds and other investors.
Click here to read full article.
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