Martyn James

All good managers, to me, are the ones who really take the time to understand the DC investor and the member experience, not just the product they’re managing. In the DC master trust space, that matters a lot. It’s about more than performance, it’s about building something that works in the context of the wider portfolio, the governance framework, and ultimately for members. I value managers who come in as partners, who listen properly, and who think about the broader outcome rather than just selling a strategy. The best relationships are the ones where there’s a real sense of collaboration and a shared focus on doing what’s right for the end investor.

The thing I love about equities is that they are such a powerful fit for DC investors. If you’re investing for members with decades ahead of them, equities make a lot of sense because they offer the potential for the highest long-term returns of any liquid asset class. Yes, you have to be able to live through drawdowns, but over a long time horizon that’s exactly where the opportunity is. What I also like is that equities give you the chance to invest in companies all over the world and to be a steward of those assets in a way that can genuinely make a difference. Through active ownership and engagement, you can help support better outcomes not just for members, but for the broader economy and for a more sustainable world. So for me, equities are compelling not just because of the return potential, but because they can help DC investors deliver better long-term outcomes for members while also having real-world impact.

The thing about private markets is that they must play an important role in a DC default, provided they’re used properly and with the right level of governance. As an industry, we’ve probably been too slow in bringing them in, but I do think that’s changing, and rightly so. For long-term investors, there’s a strong case for having a meaningful allocation, something in the region of 10% or more in the default could make sense, depending on the structure. What I like about private markets is the diversification they bring, the access to a broader range of companies and sectors, and the potential for attractive long-term returns if you’re invested in the right private market asset classes, such as private equity or infrastructure equity. As a DC investor, you also have the advantage of time, which means you can afford to take some illiquidity in exchange for those long-term benefits. Historically, the barriers have been fees and operational complexity, but I think those issues are becoming more manageable. If we can keep improving access and implementation, private markets can become a really valuable part of the member outcome story.

Why I like venture capital in an institutional portfolio is that, for DC master trusts, I believe it offers the potential for very attractive long-term returns and better retirement outcomes. If you have a long enough time horizon, you can afford to take some illiquidity and the risk of individual company failures in exchange for exposure to high-growth companies that may be at the forefront of innovation. What I also like is the broader role venture capital can play. It gives institutional investors access to businesses and ideas that you simply won’t find in public markets, and that can be a real source of long-term value. In the UK in particular, I think there’s an opportunity to support more startups and growth businesses by providing capital into an area that has been underfunded for some time. That feels positive not just from an investment perspective, but from a broader economic and member-outcomes perspective too. Of course, venture capital needs to be used carefully – the illiquidity, risk and manager selection all matter a lot. But in the right structure, and with the right time horizon, I think it can be a very interesting part of a DC master trust portfolio.

My advice to retail investors, especially when investing things like pension savings, is to keep things simple and invest with a long-term mindset. It’s very easy to get distracted by short-term market noise, but the real value in investing usually comes from being patient, disciplined and consistent over time. Keep contributing and using pound-cost averaging is really important too. What matters most is building a portfolio that fits your goals, your time horizon and your tolerance for risk and then sticking with it. For me, the key lesson is that good investing is often about doing fewer things better.