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LV= adds pension to smoothed managed fund range and improves charging structure

27/04/2021
RETIREMENT
  • Smoothed Pension starts smoothing from day two
  • Tiered charging structure now includes aggregated fund discounts based on holdings across multiple LV= Smoothed Managed Funds

Savings and retirement specialist LV= is launching Smoothed Pension to complement its range of Smoothed Managed Funds.

Designed to reduce short-term market volatility for cautious investors, the LV= Smoothed Pension allows smoothing to begin from the second day of investment, gradually averaging daily unit prices up to 26 weeks.

This improvement in gradual smoothing on entry helps further reduce customers’ investment volatility, and experience a steadier investment journey right from the start of their plan. The LV= Trustee Investment Plan (TIP) launched last year, also offers the same gradual smoothing mechanism after two days and can be held as part of a Self-Invested Personal Pension (SIPPs) or Small Self-Administered Scheme (SSAS).

LV=’s tiered pensions charging structure has been boosted by aggregated fund size discounts, based on the amounts held by one person across multiple LV= Smoothed Pension and Smoothed Managed Funds. Customers holding more than £100,000 are eligible for discounts of 0.05%, increasing to 0.15% based on the total amount invested. Charges will be reduced from 0.9% to 0.75% for investments over £500,000.

LV=’s Smoothed Managed Fund range includes three global multi-asset funds: Cautious, Balanced and Growth, which are risk-rated as 3, 4 and 5 respectively by leading market analysts Defaqto and Distribution Technology. A 10-year guarantee option is available for the Smoothed Managed Cautious Pension fund. This can only be added at the start and investors can choose to remove it following a future review.

LV= Smoothed Managed Funds are managed by the global asset manager Columbia Threadneedle Investments to a mandate set by LV=. The funds, available in pensions, bonds and ISAs, are most suited to investors with a low risk profile.

“Many savers have felt the effects of volatile stock markets over the past 18 months on their pension pots. We have listened to feedback from financial advisers and their clients to increase the appeal of these funds even further so that the benefits of smoothing starts working from day two of investment instead of 26 weeks through our gradual smoothing mechanism.

“LV= research found that mass affluent savers are twice as likely (11%) as the general public (5%) to be worried about the volatility of the stock market.* Our unique smoothing mechanism and optional guarantees are appealing to investors as our smoothing mechanism has withstood market volatility for over ten years.”

David StevensRetirement Director at LV=

About LV= Smoothed Managed Funds

LV=’s smoothed managed fund range is designed to provide steady long-term growth over a period of at least five years. LV=’s smoothing process doesn’t mean investments won’t drop in value. Smoothing will not prevent losses in longer term falling markets and investments may go down as well as up.

The smoothing process has continued to perform as intended through the extreme volatility seen as a result of Covid-19. However, in exceptional market conditions (when the underlying price is 80% of the averaged or ‘smoothed’ price) the fund will be valued on the underlying price. We also reserve the right to do this at other times.

Notes to Editors

*LV= surveyed 4,000 nationally representative UK adults via an online omnibus conducted by Opinium in March 2021.