Louise Farrand: Welcome to Changing World: New Opportunities. This podcast is brought to you by the DC Investment Forum and hosted by me, Louise Farrand, and my co-host, Dave Whitehair.
David Whitehair: This season, we're talking to the UK's leading master trusts. Millions of members and people in the UK now rely on MasterTrust for the future of their retirement finances. And we're interested to know how MasterTrust are investing and what the future holds.
Louise Farrand: In an uncertain world, how are they managing risk and what's next on their agendas?
David Whitehair: The DCIF's mission as a whole is to shine a spotlight on topical DC investment issues. And you can learn more about our research, follow us on LinkedIn, and subscribe to the show at dcif.co.uk.
Louise Farrand: Welcome to Changing World New Opportunities, season four of the DCIF's podcast. It's great to have you here. And today, Dave and I are joined by Steve Charlton. Hello, Steve.
Steve Charlton: Hi.
Louise Farrand: Steve is managing director, defined contribution for EMEA and Asia at SEI. He's worked at SEI since 2017, which makes it, I believe, nearly eight years.
Steve Charlton: Is that right? Yeah, eight years on the 4th of November.
Louise Farrand: Ah, remember remember the 4th of November. How's it going?
Steve Charlton: It's going okay. Yeah. It's been quite a journey over the eight years. We've grown substantially for the Master Trust. We're a big business anyway. Couple of acquisitions along the way. Change of administrator. Top performing master trust. It's going all right.
Louise Farrand: Fantastic. And tell us just briefly about your career path and what brought you to SEI.
Steve Charlton: That's the only thing that might just be a little longer than my job title. So yeah, it's sort of split a third, a third, a third really. It'll be 40 years in two years time.
Louise Farrand: No way.
Steve Charlton: Believe it or not. 1987, I joined legal and general. Spent about 10 years working for insurance companies before going off to into the consulting environment where I worked for Towers Periom, Punta South or Mercer, all for fairly chunky periods of time. And then saw the light and joined the investment community, joined Vanguard. Spent five years at Vanguard before coming to SEI. So it really is a third or third or third split between that sort of provider consulting and then investment manager environment.
David Whitehair: And SEI, obviously an investment manager at heart, as you say, really interested to hear how you bring that to the fore with the Master Trust.
Steve Charlton: Yeah.
David Whitehair: If you could just start by giving us an overview of the investment strategy that SEI adopts for the Master Trust.
Steve Charlton: Well, the investment strategy goes right way back to the heart of what SEI does. If we think back through the 50-year history of SEI and the way that they evolved, they started off as a technology company and they were selling technology to banks. And the founder, Al West, who's only recently retired as CEO a couple of years ago, running on our second CEO. Wow. Yeah. In that time, he felt that actually if you carried on selling stuff to people, you had no business. You only had a limited market to sell to. So started licensing technology to banks and asset managers. And then that evolved into, well, what else could we do for these businesses? And then the whole asset management arm of SEI was created. There was a piece of work that was carried out in the US on goals-based investing about 25, 30 years ago, and SEI were at the core of that.
So everything that we do around the portfolio construction, whether it's for the master trust or whether it's for charities, foundations, DB schemes, individuals, high net worth individuals, others that sort of access our services through intermediaries is all built around a goals-based philosophy.
And for the master trust, that manifests itself as a goal for a sustainable income through retirement.
So we build the portfolios from the end. What is it that somebody ... How long are they going to live? You can take a good guess at that. And we work back from there and say, if there's a level of contribution, auto-enrollment level, or if there's a level of drawdown, how much is that? And we build backwards. So yeah, goals-based is the thesis. Active management is the implementation, active with a focus on various different factors. So we're very much an investment manager looks at different factors and we can identify that there's characteristics of different factors and factors being things like value. In our case, we favour value companies or quality or momentum, but that will shift as you get through the various different stages of the glide path. And when you get into those retirement kind of phases, we're looking at more managed volatility. So we're probably taking out some of the value, having some of the quality and the managed volume there, just to make sure that the goal is met, that we've got a sustainable level of income that can be controlled rather than just blindly buying an index.
David Whitehair: So it's an equity heavy investment strategy?
Steve Charlton: Yeah. We also have a belief that if you want to meet that goal, if you're 20, you've got 70 years of investment horizon ahead of you perhaps. So why would you be diversifying other than into other equity type assets perhaps? But equities from early years, 100% equities right away until mid 40s, early 50s. And then we start diversifying into different types of equity. As I said, the internet manageable kind of environment. And as you get closer and through retirement, then we'll start to introduce some elements of fixed income, but there will be short duration. We hold very little in the way of gilts and none of it is long dated gilts because when we redesigned the glide path going back six years ago, we just felt that actually those long dated gilts were kind of contrary to what people were trying to achieve with a drawdown. And we'd identified that through the clients that we had at that time and the members we had, the biggest activity that people carried out was to draw the income, to draw the cash, and then they'd draw the income in small amounts. So we were managing the goal, the goal to provide that income for a sustainable period through lifetime.
Louise Farrand: So talking about active management, I guess it's been a very hectic time of late, a lot of volatility, a lot going on in the global economy. How, if at all, I know it's a long-term game, obviously pension investing, but how have you adapted the way you invest?
Steve Charlton: Barely at all. We set the strategy to meet the goal. The strategic asset allocation remains constant. We have a small amount, tiny amount that we can use for sort of tactical plays, but it's really a bit about currency maybe and nothing more. But the strategic allocation, especially in that growth phase, is, as I said, in three broad factors. So that would be the value, the quality and the momentum. And over time, one or two of those factors may be more favourable. They may be better price. They may look more attractive. All the signs might be that they've got better opportunities out of them. And if I take the sort of in COVID and post COVID period, we sort of dialled back the value a little bit and went for more quality and that proved to be really quite telling in the portfolio. Now we're only talking about very small percentages of movement around the edges, but also being focused on value, we kind of missed out on some of the volatility that goes with the tech stocks and certainly the big 10 stocks that make up the majority of the US market. We've never invested in Tesla and we are either underweight or overweight in one or the other of those 10. So we look for signals. We look for markers in a stock to say, does it look as if it can provide value? Does it have any of the quality elements? And we do pick up most of the return of those big stocks through the momentum strategies. So they'll be embedded in there. But as I say, from time to time, we just slightly move that based on what all of the indicators are telling us.
David Whitehair: This is obviously quite a differentiated strategy to many of the others in the market. How is this going down with the advisory community, with clients and scheme sponsors themselves?
Steve Charlton: Yeah. Well, I can tell you how the clients like it and they love it. Well, our biggest client has an absolute laser focus on investment. As far as they're concerned, as long as they describe, is it big football fan, actually big sports fan? And he says, as long as you're winning the Champions League, I'm happy. No pressure. No pressure. Yeah. And that if you look at all of the stats that come out, whether it be through CAPA, whether it be through ISIO, Barnett Roddingham or Hymans, anybody that publishes the data, Will always show that SEI over any phase of the glide path is at the top, or if it's not the top, very close to the top. And there will be times where we're not going to be ... Yeah, we might come run us up in the champions league occasionally. Yeah, that's okay. On the Harvest underland supporter, it's been years since we've been in the Premier League, let alone take what you can get. So clients love it. I think another area where clients have benefited from it is when we bought Atlas, the Atlas performance was relatively modest compared to our performance. So clients that we moved from that old portfolio to the new portfolio have had three years of outstanding performance, whereas they would've been bumbling along doing okay, but could have done better. So we've got plenty of points where we can say we've done well for clients or we've done better for clients.
The advisor community is ... Yeah, we have fans. We have lots of people that say, "Yeah, we love what you're doing. We think it's great." But there are, as we all know, a handful of people that are fixated on just price. And occasionally we lose out on an opportunity for two or three basis points, despite the fact that the evidence showing that the return could be many percentage points better.
So we work hard to try and convert people. We love talking about
Louise Farrand: It. You touched on Atlas and the Atlas acquisition. I guess one thing we're all interested in the moment is the big theme of consolidation and how that affects the way you invest, if at all.
Steve Charlton: Not at all. No. Yeah, no.
Louise Farrand: Operationally, does it affect anything?
Steve Charlton: No, not at all. No, we are a fund manufacturer. We build our own funds. In fact, the growth phase fund, the factor fund was built and seeded by the master trust. It was specifically designed for what we needed. Where consolidation has impacted is that that fund has got bigger because of the consolidation that we've carried out. If I go back to 2021, we were half a billion as an SEI master trust. We bought Atlas, we got another billion and a half. That meant that the scale of that fund was such that more people were getting access to it, more people were getting the benefits of it. Wine forward to 23 when we bought the MPT Master Trust, we had another two billion that could go into it. Yeah, yeah, yeah. So all of that gives strength to the manager. And there's plenty of capacity left in that management structure, the operational management structure to take on much more.
Louise Farrand: Great.
Steve Charlton: There are other investors in that fund as well because it's done so well, and it's been one of the great success stories of SEI's European operation and the launching of it.
Louise Farrand: That must be nice.
Steve Charlton: Yeah, it is. We're keen to consolidate more. In the notes that you sent across, it was talking about consolidation as a theme, and it's not just about investments, but it is about are there enough providers in the market? Are there too many? Are there some that are performing poorly? Are there profitable providers because they're not profitable? Then the commitment of a funder or a commitment of a PLC that sits above may start to wane over time. For us, the consolidation is not about scale. We're a business with a trillion dollars under management. It's not about scale. For us, it's about making sure that the master trust has momentum and the master trust continues to be seen as a good option for employers in the UK. And if it's growing, people can see that more people are adopting it and are more likely to come and join us on our journey.
So I think we're slightly at odds and disagree with much of the pensions bill around scale because we've already got there in a larger sense rather than just the master trust. But it's about momentum for us. And being pleased with the job you're doing, having that nice sense of good feeling about doing a good job for clients. And that's for the whole of a team. It's not just for me.
David Whitehair: Now we can't have an investment discussion without talking about private assets. Where are you on your private asset journey? What's your strategy? How have you been accessing things or how do you plan to access private assets?
Steve Charlton: Yeah, it's more of the plan to access. Again, I go back to the fact that we're an asset manager. Many of these private assets, we already manage elsewhere within our organization. So we've got a private equity team, we've got a private credit team, a structured credit team, an infrastructure team, all within our asset management business. That does give us the advantage that when it comes to cost of manufacturer, we're not paying away huge amounts of money to third parties to manage funds for us. So we can be a bit more flexible in the way that we deliver. We are going through the application process, the approval process for the moment for R and LTAF. We will have that, we believe, approved before the end of the year. That's what our ACD tells us, or that's what they believe based on their experience at the minute.
No pressure on the FCA there, obviously.
Louise Farrand: Obviously.
Steve Charlton: Obviously. But then we'll time the launch appropriately within the first half of next year. It'll go into the growth phase initially, because that's where the weight of our assets are and where we can think we can overcome the hurdle rates. And hurdle rates internally are a big, big thing for us. If you've got investments in public markets that are performing so well as ours are, the last thing we want to do is actually to take money away from that pool of money and put it into something that is not going to perform as well after the larger fees have been deducted because these products will have larger fees attaching to them. So that hurdle rate is something that we're obsessed with within SEI. If we pick an asset type, be it private equity, be it structured credit, be it infrastructure, is it going to give collectively the return that is better than just leaving the money where it is?
And if you look at the dispersion of returns across the master trust market, some of those that are well under the average, their hurdle rate is really, really easy to achieve. And it's not surprising that they're quite happy to throw lots of different asset types at it. We've got to be more selective, not just selective about the asset type, but also the timing of the investment as well. And one of our biggest fears is that both the government and the consulting community will start to do league tables to say, how close are you to meeting your mansion house challenges, how much of that is in UK? And they think it will be a straight line between now and 2030 where everybody should be along that line or above that line. And that's just bad for outcomes for members. What we think you need is to be a little bit more diligent about when and how and where and why you invest in something.
And that might mean that actually you might get to 2029 and still not have anything in the UK and that's okay because it just means the right asset at the right price hasn't come along.
And when it does, then you can deploy and you can say that's going to achieve a better outcome for members rather than being forced to buy something along with everybody else that is overpriced or poor quality and it's going to fail, which is a bad outcome for members. And that all plays to our theme that we've always talked about not only being goals based, but the master trust being investment led.
Louise Farrand: Yeah, for sure. I mean, we've been chatting to some Australians recently about this and it's interesting. One of our kind of pet themes at the moment as a DCIF is everyone looks at Australia as this kind of perfect market, but actually it's not perfect. It's a lot we can learn from things that they've done that haven't worked out so well. And particularly the league table thing is one of them.
Steve Charlton: I think it
Louise Farrand: Squeezes everyone into the same mentality, doesn't
Steve Charlton: And chasing the same assets. For another purpose, I was looking at some of the stuff that the Australian regulator publishes on a, I think it's half yearly. The thing that surprised me first was that whilst our government is saying consolidation to have fewer smaller, sorry, fewer bigger providers is the way to go. The Australian market still has what? 56 my super plants for a working population that is less than half of the UK, we've already got less than that. And then when you look down at their asset allocations, it doesn't have the huge private market asset allocations collectively that's been suggested. Yeah, it has much higher infrastructure type assets, a lot of those in Australia, some of those internationally. But I think there's been a little bit of smoke and mirrors about selectively picking the bits of various territories, whether that be Australia or Canada that suit the narrative rather than actually an honesty that says, yeah, we can learn some stuff and we can do some stuff, but actually we may be pretty good at what we do already and why not promote what we do rather than looking outside and saying, who does it best, who can we copy and then not necessarily representing what they do in best practice.
Louise Farrand: And that's such a great opportunity to learn, isn't there? Rather than just thinking they've got all the answers, what have they done that we could do differently? Where are the stumbling blocks for them?
Steve Charlton: Yeah. And both in Australia and Canada, they have the benefit of not only time, but more money into the system. If you think we've had a little over 10 years of auto enrollment with eventually 8% being that benchmark for a portion of the work in population, well, Australia started much earlier on the MySuper group and DBE ended much earlier and contributions have been much higher for much longer. So there's a bigger pool of money. I think that's the first thing we can learn from, that if the pool is bigger, then you can do more things with it, but that doesn't necessarily mean create a bigger pool of money by shrinking the market to the point where there isn't enough creativity left in the market because there's no need.
David Whitehair: So can we infer from what you said around the UK and timing that you haven't signed the Mansion House Record?
Steve Charlton: Yeah, we did. Yeah. We thought long and hard about it. And for a long time, we were very skeptical about the wording that was in it, but with Pensions UK and the ABI, and with the help of the Lord Mayor's Office, as different iterations came forward, we had suggested some softening and some words and some commitment from government, we became more convinced that we could sign it and achieve the ambition that it needed. And the key for us was that there's a faded out box in the centers about two thirds of the way down, which is the government commitment. And the government commitments were, I'm talking through them in the sort of order of priority as far as we're concerned, but the most important coming last. It was first of all, that the government created an environment to have a pool of investment opportunities in the UK.
And without that environment, the market isn't big enough to support every one of us in our pursuit of an opportunity. So you'd get poor quality or expensive. The second piece was about the pragmatic approach to consolidation. So that wasn't a hard line that if you're not at a number, you're out. It was, let's see how consolidation plays out. Well, this is my interpretation. Let's see how consolidation plays out over time. And if the market dynamics of consolidation aren't working as we want, we're not going to interfere. We've got to let it happen. But the most important piece for us, particularly if you are looking at private markets, is to change the narrative From cost to value. And I still have a bit of an issue with the phrase value. We're talking about our kids earlier. If you sent my daughter into Tesco's and say, "Go and get something good value". She'd Go straight to the value aisle, and that's cheap. She's not going to Tesco's number one range or Tesco's finance because that's not how value is thought of in the mine. So changing from cost to outcome is a better option. I was talking to somebody, again in the industry as we tend to, who said that they'd just been to Sydney. And as they flew into Sydney Airport, there was one of the super plans that had a big poster on the wall that you see and says- Amazing. "Returns net of fees." And that's what they're talking about. Yeah. So the Australian market has things we can learn from how it demonstrates good value or better outcomes, and that is return net of fees, Really Easy. It's not cost, it's not value. But as I said earlier, some of that consulting community are still obsessed with being the only attribute to a proposition being cost and low cost equals better, and that's not the case.
Louise Farrand: Let's go back to private markets and talk about, I mean, obviously in the early-ish stages, do you think it's fair to say of your private markets journey or is that an oversimplification really?
Steve Charlton: By the time you get to go to the FCA, you're kind of there.
Louise Farrand: You're kind of there.
Steve Charlton: Yeah. You know who your administrators are, your ACPs are going to be, you know what your asset structure is going to be, all of those things, you've got to prove to the FCA that you've got a source of funding, you've got a source of funds to deploy in them. Of course. So by the time you get to the point where it's a bit formed where
Louise Farrand: You're at. Do you see private markets as playing a role later in life? I guess what I meant is a lot of people see private markets as kind of early on in the journey of someone's life, but increasingly it seems as though there's more of a conversation around what's the role of private markets as people get later on in life and into retirement. Do you think they can play a role there and how much is that factored in at the moment?
Steve Charlton: Absolutely. Yeah. Yeah. I said earlier that we're going in the growth phase and for our LTAF, the first one, by the time somebody reaches 55, they'll have no assets sitting in that fund, which then gives them the ability to draw without being gated or anything like that. So all of the things for convenience and to meet members' needs as they believe them to be. I want my money, I want it now. And it's not a case of, I want my money. Oh, I've got to wait six months before there's the next dealing cycle or before this asset can be sold. So that's why we did that. But very much we believe that as you go through that sort of consolidation type phase and into that income drawing type phase, there are asset types that really do suit the ability to throw off income to be able to pay income. The great problem that we suffer from in the UK market at the moment is time.
We've already talked about auto enrollment only having been around for just over 10 years and there aren't a huge number of people. The volume of people in that sort of 60 plus age group. It's really small. So the pool of money is really small
And you do need quite a pool of money to be able to access certain asset classes.
Louise Farrand: Of course.
Steve Charlton: Yeah. We think we're great fans of structured credit and we're somewhat of an expert in the US at structured credit. And we think that that's a good low cost, relatively liquid, but in an illiquid kind of way, you're buying bundles of debt, whether it be from mortgage companies or loan companies and things like that, but they throw off income and that kind of structure is ideal for people who are either drawing income or are consolidating to a point where they're nearly ready to draw an income. So the only reason we're not launching at the same time is because if you look at the demographics of the SEI master trust, even with its two acquisitions, we still don't have a heap of people that are in that age group. So the asset pool, but we'll get there.
David Whitehair: I think average age of a DC member in UK is like mid 40s. Is that similar profile to SEI's trust?
Steve Charlton: Yes, it would be. Yeah. Yeah. The tail is fairly small, but really shallow as well once you get through 55, certainly. And you can identify that there's a weight a wall of members that they will age. They can't stop that. I've tried. They can't stop that. And they will get to that 55, 60 within the next five or 10 years.
David Whitehair: And people retiring now probably still got an element of DB from the starts of their careers. They're not maybe yet representative of generation DC which have a full life of DC.
Steve Charlton: Even if I look at my own experience, as I said, I joined legal in general in 1987. I went into a DB plan and I was in a DB plan.
Louise Farrand: Not at all jealous.
Steve Charlton: Yeah, but you've got time I don't.
Louise Farrand: Oh, that's true. That's true. So tell us, Steve, a bit about regulatory shifts. I mean, obviously there's a lot going on at the moment with the pension schemes bill. How are they, if at all, influencing the way that you're thinking about investment?
Steve Charlton: Again, I come back to there's not a lot that influences the way that you think about the investment because we've got that long-term goals based objectives. There may be short-term things that we think about, but that's not going to change a strategic allocation. We might tweak a little, as I said, between those factors of value, quality and momentum. But in reality, the approach doesn't change. It kind of rides through the long-term view of any short-term noise. We do like the value for money framework that will help change the narrative. I think that's a good thing. I think it's becoming a little over complex from where it started and could be gained, but it'd be really interesting if it was brought forward to now for some of those, the master trusts that are not performing as they should be, and they're all pretty much the larger ones.
If they had to test themselves against the value for money, would they be as likely to fail that as some of the more modest size would fail the 25 billion test? Where does that leave a market if you look at it like that? If you're well below average and going to compare yourself to somebody like ourselves or some of our peers that are at the top of that investment tree-
Louise Farrand: Yeah. You look at the differences, incredibly material.
Steve Charlton: Yeah, exactly. Yeah. So that would bring a dynamic that would be a little confusing. Yeah, interesting. Yeah. Yeah. We like the bits of consultation around the advice guidance boundary. We think that will open up opportunities to be able to communicate with members in different ways, whether that be through an element of tech-led communications or whether that's more people- based communications. There's
still a place for both. But we think particularly around that retirement journey, it will enable us to help people more than the infrastructure or the regulations do at the moment.
Louise Farrand: Currently allow. Yeah.
Steve Charlton: And if we have that wall of people that are going to be coming up to 55 and 60 in the next five to 10 years, then now is the time to prepare to help them rather than think, "Oh, they're here and they're asking questions. Yeah, you need to build the infrastructure before." So I think generally there's not a lot that'll impact the investment process or the investment structure or thesis. It's more around what else is there around the legislation that can help further our ability to help members or challenge the status quo in terms of scale.
David Whitehair: So we think about now looking ahead and what the future holds for the SEI mass trust in investment terms. I mean, maybe we've answered this already, but you talked about private assets, bit structured credit. What's next on your investment agenda?
Steve Charlton: This very week I think we've got a transition going on, which is removing tax-free cash, that cash element of the accumulation. Another attribute that we have is that we're evidence-based. Everything we do is based on what we see from the behaviours of the members that we look after. And one of the things that we were seeing is that people were not taking 25% cash at a retirement date. Interesting. And actually that accumulation of cash was actually just holding back the potential outcome slightly. And that even at that point in the portfolio, there's enough cash-like instruments in the makeup to actually be able to say, right, we can squeeze a little bit more out of the assets that we've got rather than just popping into cash fund. I've talked about short duration, fixed income. It's cash-like and serves the same purpose. So if we can have members drawing from that pool rather than cash, you can have a slight uptick.
And we've decided to do that now because we don't have a lot of people. The transition- Less painful. Less painful. But it is preparing for those people that are coming in the next round of the wave of members.
David Whitehair: Interesting, so is that a complete removal of a money market fund from the strategy?
Steve Charlton: Yeah, and it was only increasing in very small portions over four year period before the normal retirement age of the scheme, which is set at 65. So we're not changing anything dramatic and it's not impacting a large number of people. And we think it will just give a little bit more flexibility to the way that people will think about their retirement. The worst thing that can happen is that we accumulate some money market to 25% of the fund. Somebody says, "I'm not retiring until I'm 70," and then we reinvest back into the structures that we use around that time. But that just seems daft. So we've removed it completely this week.
Louise Farrand: Crystal ball gazing...
Steve Charlton: Go on.
Louise Farrand: Can you pick one investment trend or technology you think will play a role in reshaping DC pensions in the next ... I put five years, but few years.
Steve Charlton: Reshaping. Yeah. I think there are a couple of things.
Louise Farrand: Okay.
Steve Charlton: The first is cost. It's not a technology, but it is a theme.
Louise Farrand: Of course.
Steve Charlton: For the last 15, 20 years, the industry has been obsessed with lowest cost possible, being deemed to be in best value possible. And if we can get the government to change that narrative, and if the consultant community can adopt a value or outcomes-based approach rather than a cost-based approach, I think we can see more imaginative things being done inside portfolios, even more imaginative than throwing some private market or liquid elements at it. Yeah. We've proved that you can do value for money with good performance through being more focused on the things that drive better outcomes, value, momentum, quality in terms of the factors, but certainly that active overlay rather than just simply adopting a flavour of index. I think that could actually get ... That scope to give a little bit more to an investment budget should be able to improve outcomes for members because you can access things that are shown to do better than simply blindly following an index.
David Whitehair: You think perhaps private assets and the development of that programme across the whole market might help the cost dynamic in that these are not cheap assets. And if we see them delivering in years to come-
Steve Charlton: I wholeheartedly believe that that will be the case, and I really hope that it does show itself in that way. Again, if we look at, as I said, the range of outcomes that exist at the moment, if some of those that are below the average can prove that by investing in private markets and paying a little bit more for that, a member gets a better outcome. Yeah, I don't care if it means that some of those competitors get closer to us in terms of returns. It's going to be a better outcome for members and a better view of the world for the industry because then we can also, right, collectively, because it's what we're here for, we can provide a better future for members by doing things with a little bit more imagination, a little bit more creativity, and a little bit more flexibility in the price of delivery.
David Whitehair: Yes, absolutely. In your view, Steve, what's an underrated investment asset class?
Speaker 4: Structural credit.
David Whitehair: Structure credit. Very quick.
Steve Charlton: Yeah. Yeah. Well, I did tap up our investment director before I came in here to ask him. He did give me some thoughts about his view on inflation and how it's going to be a little bit more sticky in some ways of mitigating that. But actually, at the end of it, he said structured credit. So I'm saying structured credit. It's a good asset class. It's not as well developed in Europe as it is in the US. We think that will change. Certainly as there becomes more demand for that kind of pre and in retirement kind of asset that spits off lots of income to be able to help pay what we're ultimately here for and income to members when they stop working.
David Whitehair: Yes.
Louise Farrand: Perfect. Well, that's a good point to finish on. Yeah, brilliant. Steve, thank you so much for coming on the podcast.
Steve Charlton: Thanks for having me.
Louise Farrand: Great to have you.
Steve Charlton: Being really good fun.
Louise Farrand: Thanks.
David Whitehair: Thank you for listening to Changing World: New Opportunities, the DCIX podcast.
Louise Farrand: Visit us online at dcif.co.uk, where you can read all our research, follow us on LinkedIn, and subscribe to the show.
