With around 1.6 million members, the provider set up by Danish pensions giant ATP has in just six years become one of the largest pension providers in the UK.

Launched with a high-profile board of trustees, including former Conservative pensions shadow Nigel Waterson and former Government Actuary Chris Daykin, the scheme now runs schemes for 32,000 organisations.

But it has been beset by administration problems, with many members’ contributions not collected. Last year Now: Pensions exited the Pensions Regulator’s Master Trust Assurance-credited list.

The scheme’s default is a diversified growth fund managed by a subsidiary of parent, ATP. It operates a risk parity strategy, an approach used by hedge funds, where allocation is determined by risk and return levels rather than holdings in the assets themselves, which is why asset allocation charts are not presented. It targets a 60/40 equity/bond strategy risk profile, but uses derivatives, leveraging the fund by 200 per cent or more.

Performance has been disappointing, with Now experiencing the lowest 3-year returns of any non-faith based provider in the study, almost a full 3 per cent below the Corporate Adviser Pensions Average (CAPA) Index over three years.

*Performance looks better over five years, at 7.1 per cent annualised, but this figure is enhanced by an extraordinary payment into the default over 2013 and 2014, following the sale of a 50 per cent stake in Now: Pensions Limited to ATP following a restructure. Now: Pensions says it is unable to disclose how much of the return in 2013 and 2014 relates to this extraordinary payment for commercial reasons. Therefore the 5-year annualised performance figure shown should not be interpreted as being reflective of the skill of the manager, as an unknown part of this return has been generated by a one-off asset sale.

No asset allocation graphs are given, because Now: Pensions does not hold equities, bonds and other tangible asset classes directly. Its risk parity strategy uses derivatives, which can be geared, meaning its sector exposure could be in excess of 100 per cent, making a percentage-based asset allocation approach inappropriate.