Dream Team

28 July, 2010

We’ve just launched our Pensions Fantasy Football game for the 2010/11 season and I would like to cordially invite you all to register and take part.

What does football have to do with being a trustee? In the following paragraphs, I will contrive to provide an answer. But it's not too much of a contrivance because our game, like the real thing, is at heart all about risk management. Let me explain..

While the investment strategy side of trusteeship might be a good deal harder than picking a Pensions Fantasy Football team, I believe there are some similarities.

Any good asset allocation strategy needs to balance up risk and reward if it is to gain outstanding returns from its investments and, more importantly, match the scheme’s liabilities. Similarly, any good football team needs to balance up the quality of its defence (risk-reduction) with the abilities of its attacking players (return-seekers).

In Pensions Fantasy Football you are provided with a budget of £55m to spend on your squad. (No, you can’t take it in cash for your scheme). Defensive players will gain points for not letting goals in; attacking players will acquire points through scoring goals. Therefore, you need to decide how to balance your team expenditure on reducing risk versus acquiring returns. Is it better to buy one top-notch, very expensive striker – but risk letting in lots of goals through having to buy cheap defenders? Should you buy a robust goalkeeper and end up with a literally hit and miss front line? Or, will you spread your money evenly across every position on the pitch but risk mediocre performance from all of your squad?

To labour this analogy between investment strategy and football even further, I proudly present my guide to Fantasy Football player positions and their equivalent asset classes:

Goalkeeper – spending big on a goalkeeper might be a good risk management tactic, but it reduces the amount of money you’ll have available for players who might score goals. After all, the best you can usually expect from a goalkeeper is a clean sheet. Asset class: cash

Full backs – another risk-reduction measure, but a good one will make the occasional foray up-field and deliver surprising results. But beware the hapless full back, or even the good defender playing as part of a poor team. Asset class: corporate bonds

Centre backs – They’re more likely to be found near the opposition’s goal than full backs, but they’ve still got a risk-control role to play. Being in the right place at the right time is a vital skill. Asset class: property

Midfielders – choosing players for this position is one of the hardest decisions in football. There is a myriad of types of players, tactics and formations – some will perform a similar role to centre backs; others will be first-class goal scorers; others again will be unique and unusual players who define the very strategy of their team. Most teams need a variety of different types of players in their midfield. Asset class/strategy: hedge funds/fund of hedge funds.

Strikers – at least one good striker is essential for the success of the team. Choose an underperformer and they can drag down the rest of the squad. They are the ultimate return-seeking players. Asset class: equities

I confidently predict that this will be part of TKU in the near future.

I’m also sure that I have convinced you that football is good for your development as a trustee. So, join us for the season at Pensions Fantasy Football. There’s an iPad for the overall season winner and other great prizes to be won monthly.

PS - if you’ve managed to read this far but hate football and love prizes, join our ‘Lucky Dippers’ league – just register through Pensions Fantasy Football click on the ‘Lucky Dip’ button for your team selection, and go to ‘private leagues’ on the right hand side of the setup screen once you’ve done that. Enter the PIN 1595 and you’re in the Lucky Dippers! One rule for that league – once you’ve chosen your lucky dip team, you’re not allowed to change it again for the rest of the season. Don’t forget to check back from time to time and see how you’re doing against your fellow Lucky Dippers though.