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Asset Class
Asset benchmark

Liability hedging instruments

– UK conventional and index-linked Gilts

– Interest rates and inflation swaps

– UK gilt repurchase agreements

– Exchange Traded Derivatives

– Sterling corporate bonds from government backed institutions and Sterling corporate bonds from systemically important institutions with very high financial and/or operational linage to government

40% Liability benchmark

Return-seeking assets

– Global Government Bonds

– Global Aggregate Bonds (including global government, government-related, corporate
and securitised debt from developed and emerging market issuers of investment grade

– Developed and emerging markets debts of sub-investment grade category

– Public Equity

– Alternatives (including property, private equity, alternative credit, farmland and timberland, absolute return strategies)


JP Morgan Government Bond Index (ex-UK).

Barclays Global Aggregate Bond Index; Suitable indices will be
specified for particular credit market sub-sectors.

FTSE All World Minimum Variance Index.

Cambridge Associates Performance Indices.

Hybrid assets (assets with return-seeking and liability hedging characteristics) 12.5% Will vary according to the asset class
Cash 6% SONIA & UK 3 month LIBOR

Use of derivatives

Derivatives are used to mitigate underlying portfolio exposures to foreign exchange rate fluctuations, interest rate fluctuations and movements in equity markets.

For more information on this, read our full Statement of Investment Principles.