Pensions and Retirement Training Course on Managing Investment Costs and Fees

Module 1: Overview of Investment Costs in Pension Funds
Types of investment costs: management, performance, custody, transaction, operational
Direct vs. indirect costs
Impact of fees on net returns and funding ratios
Global trends and benchmarking practices
Case study: Cost inefficiencies in pension fund investments

Module 2: Management and Performance Fees
Understanding management fees: fixed, tiered, and asset-based
Performance fees and incentive structures
Aligning manager compensation with fund objectives
Negotiation strategies to optimize fee arrangements
Workshop: Calculating the impact of fees on fund performance

Module 3: Transaction and Operational Costs
Trading costs: commissions, bid-ask spreads, and market impact
Custody, administration, and operational expenses
Evaluating hidden and indirect costs
Best practices for monitoring and controlling operational expenses
Practical exercise: Analyzing transaction cost data and optimizing trading strategies

Module 4: Cost Benchmarking and Fee Monitoring
Benchmarking fees against industry standards and peer groups
Using Total Expense Ratio (TER) and other metrics
Reporting and transparency for trustees and regulators
Cost-benefit analysis of active vs. passive management
Workshop: Creating a fee monitoring dashboard

Module 5: Governance, Compliance, and Cost Optimization Strategies
Integrating fee management into investment governance
Fiduciary responsibilities and regulatory obligations
Strategies to reduce costs while maintaining performance: passive allocation, manager consolidation, negotiation
Monitoring, reporting, and ongoing evaluation of fees
Capstone project: Designing a comprehensive investment cost management plan for a pension fund