If I understand you correctly you are looking to invest over a 3 year period and then start your draw down.
Presumably you will take 25% of the fund tax free at the start and then take a regular (or irregular) income from the rest, depending on how much your expenditure outstrips your income from other sources.
I am not a financial expert of any sort, but as far as I know three years is too short a period to safely invest in stocks and shares or any derivatives based on stocks and shares.
You are at far too much risk from a temporary down turn in the market.
I think such investments are supposed to be for a minimum 10 year period and not for those who will be forced to cash them in at a specific point.
Traditionally, for a pension you started out aggressively in your 20s and 30s putting your money into growth stocks because over a long time line the stock market has (usually?) always out performed other types of investment.
However when you got to within 10 years of cashing in you moved to low risk stocks, and then mainly into bonds and cash because you wanted to preserve your pension pot and not risk needing to cash in your investments when the stock market was in a temporary crash (such as over the last 10 years or so). By retirement age everything should be in cash and government bonds. No more potential for massive gains, but you have locked in your gains to date.
Look at
http://www.tradingeconomics.com/united-kingdom/stock-market for example and look at the graph from 2000 to 2012.
The stock market is still not back up to the levels of 2000 and if you had needed to cash in your stocks during 2003 or 2009 you would have seen your investment value halved.
The years 2000 to 2003 are a fine example - as I say, invest in 2000 and see your investment halved by 2003.
The market is coming back up towards the all time highs but is still relatively unstable - witness the crash and then partial recovery this week.
In three years time it could be back down to 2003 levels.
One complicating factor is this "quantitative easing" going on at the moment coupled with artificially low interest rates.
For the traditional cash portion of a mature pension portfolio this means that you get virtually no interest and the value of your pension pot slowly erodes.
Government buying of bonds (quantitative easing) is artificially forcing the bond price up.
For fixed interest bonds this forces yield (the interest you get on your initial investment) right down.
There is also the "elephant in the room" - at some point the governments are going to stop printing money and artificially inflating the bond market.
At this point the cash value of the bonds should drop sharply, and the yields come back up to normal.
This would be the point to invest in bonds, but not to be holding bonds bought at a higher price.
So the traditional bond portion of a mature pension portfolio isn't looking good at the moment either.
TL;DR quantitative easing has screwed the traditional pension fund strategy.
Only once this has stopped is it relatively safe to go back to the traditional methods.
I am in this dilemma at the moment.
I have a small SIPP holding cash.
The market is near its peak and volatile, which is not the situation to invest for short term growth.
The bond market is waiting for normal service to be resumed, so now is not the time to buy bonds
Cash is generating minuscule income but seems to be the least bad option - at least for the next couple of years.
So, in summary, I would be wary about investing in the stock market if you intend to cash in your investments in the next 3 years to start paying out.
If you think that, say, 50% of your pension will remain untouched for 10 years or more and that you can manage without it if the market crashes, then you could consider long term investment of around that portion.
If you are thinking that your health may prevent the enjoyment of your money after 10 years or less then I would be strongly tempted to keep it in cash for the moment.
Please note again - I am not in any way qualified to give financial advice and this is purely a personal opinion.
I am trying to explain my personal view about risks of loss against chance of profit in the short term.
Footnote:
Our kids have gone through University and it wasn't the same as when we went through University.
We had grants; they have loans.
One has paid the loan off.
The other is still in debt aged early '30s and is unlikely to clear this debt any year soon.
I left University debt free in an employment market where a degree was a rare thing (about 5% I think) instead of being as common as muck (around 50%).
So again, different times.
Cheers
LGC