Have you been following the CDI debate or looking at alternatives to Gilts based funding measures?

Moving away from traditional actuarial valuations and focusing explicitly on a pension scheme’s ability to meet its cashflow requirements can lead to some interesting observations...

At a client review meeting recently, I caught up with Rob Gardner at the café below Redington’s impressive new office, just a few minutes’ walk from Bank Station in the heart of the City.

Rob was outlining how Financial Canvas can help Redington to deliver their ambitious aim to bring financial security to 100 million people. As we chatted, jotted and sketched, Rob created this delightfully simple grid that formed the basis of our conversation for the rest of the meeting.

Another great blog from our John Walley and his amazing work creating online dashboards for Financial Canvas clients... Contact us today to build a dashboard for you.

A few months ago, I wrote about reusable charts. The thinking behind the blog post fed into the initial design for a new web application - Financial Canvas Studio. It helps professionals in the pension industry understand their financial models and the assumptions that go into them - leading to smarter decisions.

We were interested in the comments from PSolve “Cashflow Negative? Don’t worry about it!”

Whilst we appreciate the sentiment – and that might be the right advice in many circumstances – don’t forget that as benefit payments start to grow a dangerous black hole awaits.

We believe that Trustees ignore cashflows at their peril!

We were delighted to see the article in the Actuary this month looking at the impact of including covenant risk in asset liability modelling for defined benefit pension schemes and thank the authors for bringing this important topic to a wider audience.

Our mission is to create easy online access to these tools for all schemes. Technology is the great enabler of our age and we believe that all trustees should be able to access this advice based on their circumstances and presented in a clear and engaging fashion so that they can make funding and investment decisions with confidence.

More from financial-canvas-studio helping trustees make better decisions with confidence. Watch this trailer to see our web-based dashboards at work and comment here if you’d like to see this analysis for your scheme. How robust is your LDI solution?!

Deciding on design and features for any software always benefits from getting the users involved. In this post we’ll give a quick update on the Studio, our online charting environment, before passing the reins over to you and asking for your input on the first of many design questions we will be posing.

The ESG (Economic Scenario Generator) dashboard helps our clients understand the nature of the simulations that we/they have generated. What features does it include? Does it capture your views correctly so that you can use it to test and compare different investment strategies?

Work on the studio continues apace.

The Studio is our online charting environment where clients can access interactive dashboards of models designed and built on the Financial Canvas servers.

I’m delighted to welcome John Walley to the team who is helping us to implement a smart new dashboard framework taking the best from React and the d3js libraries. John brings a wealth of experience in software development and a passion for data visualisation – see his blog on React/d3 for some of the technical details…

I was reading Amy Kessler’s excellent article in Professional Pensions this morning ‘Understanding the limitations of the CMI longevity model’.

Amy is right to remind us that the model has limitations. All models do; they are necessarily and by definition, simplifications of reality. (For the time being anyway until we can run simulations of reality within the simulation of reality that we all ‘exist’ if you subscribe to the hypothesis popularised by Elon Musk recently…). I digress.

When it comes to creating visualizations on the web D3 is often your first port of call. Whether by putting together a custom creation from scratch, or making use of one of the many charting libraries and examples available.

The former, creating visualizations myself using the low-level functionality provided by D3, is my area of interest. In particular I'm interested in doing this over-and-over again. As with any other type of software development I'm involved with, I'm looking to make a trade-off between creating abstractions and designing for reuse on one-hand, and KISS and YAGNI on the other-hand.

I read Nikesh Patel’s engaging article Superflat with interest. Nikesh laments the focus on gilt yields and argues instead for a ‘time consistent flat discount rate’ to value pension schemes. It is always welcome to see discussion on alternatives to the current valuation methodology – marking £tr’s of pension liabilities to a tiny (by comparison) index linked gilt market has unintended consequences which Nikesh articulates well.

To my mind asset prices remain the right place to start. We need to be smarter though about how we choose them and have been working with pension schemes and insurers to design portfolios that deliver matching income with a higher yielding asset universe. See Solving The Pension Conundrum.