Cartwright, a pension specialist for defined benefit and hybrid schemes, announced a pioneering bitcoin investment in a UK pension scheme’s portfolio on Monday. The firm detailed:
The first of its kind in the UK, the allocation took place in October after a rigorous training and due diligence process.
Trustees of the unnamed scheme opted for a 3% bitcoin allocation, aligning with the scheme’s long-term investment horizon. Bitcoin’s asymmetric return profile allows a small allocation to potentially yield substantial gains, supported by robust risk management at both the scheme and asset levels, Cartwright detailed.
Sam Roberts, Cartwright’s director of investment consulting, commented: “Trustees are increasingly looking for innovative solutions to future-proof their schemes in the face of economic challenges. This bitcoin allocation is a strategic move that, not only offers diversification, but also taps into an asset class with a unique asymmetric risk-return profile.” He emphasized:
Integrating bitcoin into a pension scheme’s investment strategy is a bold step that reflects the forward-thinking nature of the trustees involved
“We are proud to have led this ground-breaking move, which we hope will be the start of a trend for institutional investors in the UK to catch up with their increasing number of peers and competitors around the world who are already taking advantage of bitcoin’s unique attributes,” he added.
Steve Robinson, Cartwright’s head of investment implementation, highlighted that security is a top priority in their approach, ensuring that even risk-averse pension schemes can manage volatility effectively. He explained:
By combining a highly secure custodial solution with a mechanism to quickly trim profits as they arise, we’ve opened the door for risk-averse pension schemes and other institutional investors to benefit from bitcoin’s potential growth whilst managing volatility within a secure strategic framework.
The solution features a low minimum investment threshold, making it accessible to pension schemes of various sizes, unlike many early-stage investment options, Robinson described. He noted that this approach integrates bitcoin into a traditionally conservative sector, aiming to deliver long-term value to scheme members and reduce dependence on employer contributions through secure custodial practices.
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