The 16th Pension Forum in Nicosia examined the critical issues facing Cyprus’ pension system and the new perspectives emerging in a rapidly changing environment, according to the event overview. The forum, titled ‘Making better decisions – New perspectives for the pension’, was held with the support of Eurobank.

According to the discussions, the need for strategic flexibility and know-how has never been more urgent, as technology, investment practices and the regulatory environment continue to change at unprecedented speed.

Pension funds are therefore expected to act both as pillars of security and, in addition, as levers of sustainable economic growth.

In his presentation, Savvas Christodoulou CFA, Manager of Investment Advisory at Eurobank focused on understanding investment strategies, return opportunities and risk management.

He said that the inclusion of securities with low correlation “helps reduce volatility and improve the return/risk ratio”, adding that returns are less affected in cases of large cash flows and that there is better stability during market crises, with outcomes becoming more predictable.

Christodoulou also noted that the management committee of each fund determines its profile and, consequently, the level of risk it wants to assume, which shapes the investment strategy.

He referred to the investment horizon, the years of duration, the expected return of the fund and, furthermore, the acceptance of short-term losses, saying these elements define risk tolerance.

Meanwhile, it was mentioned that the asset allocation of pension funds has changed drastically over time.

For years, funds followed an investment model centred on stocks and bonds. However, increased demands for long-term stability now require greater diversification and adaptability.

According to Eurobank, in this new investment landscape it advises and works with pension funds to reassess their assets and their geographical allocation so they are positioned to take advantage of new opportunities.

Its services include risk management, offered with transparency, which it said remains at the heart of cooperation with clients, since each contract is treated as a long-term partnership.