With asset deterioration due to drops in equity markets and a decrease in long-term government bond yields causing an increase in solvency liabilities, pension funds are in a tough position. A Canadian defined benefit solvency funding calculation assumes some plan members will elect to take a commuted-value lump sum, while other members will elect to […]
Investors and economists around the world are drastically changing their forecasts as the world enters another week of disruption from the spread of the coronavirus. Indeed, Scotiabank’s updated economic forecast suggests recession is inevitable in many countries, with global growth expected to average 1.3 per cent in 2020, the lowest level since the decline of […]
The Healthcare of Ontario Pension Plan reported a strong 2019, posting a 17.14 per cent return for the year and hitting a funded status of 119 per cent on a smoothed basis. The fund outperformed its benchmark by 2.08 per cent — or just over $1.65 million — and far surpassed 2018’s return of 2.2 […]
Since stock markets can turn on a dime, long-term institutional investors may find some opportunities amid the current chaos. It’s been a long time since genuine panic hit markets, says Greg Taylor, chief investment officer and portfolio manager at Purpose Investments. “Generally, markets hate uncertainty and, arguably, we’ve never had a more uncertain time than […]
Canadian pension plans have increased their demand for long corporate bonds, but high demand and low yields combined with a relatively small marketplace in Canada can pose challenges for investors, said Randall Malcolm, senior managing director and portfolio manager of Canadian public fixed income at SLC Management. “When we look at the supply side of […]
In a historic move, the U.S. Federal Reserve lowered its target range for the federal funds rate to between zero and 0.25 per cent on Sunday. The Fed is taking the emergency action in a bid to help alleviate the extreme economic disruption caused by the spread of the coronavirus. It said it intends to […]
Canadian employer pension plans saw the market value of their assets increase 1.6 per cent in the third quarter of 2019, up from the previous quarter, according to new data from Statistics Canada. The value of assets was also up 7.3 per cent in comparison to the third quarter of 2018. Bonds saw the highest value gain in the […]
The solvency levels of Canadian defined benefit pension plans are down off the back of roiling equity and bond markets in the wake of the coronavirus outbreak. Aon’s latest median solvency ratio survey found DB plans were down 6.7 per cent on average, from 102.5 per cent in early January to 95.8 per cent at […]
After a week that saw coronavirus worries wallop equity markets into correction territory, the U.S. Federal Reserve announced a 0.5 per cent rate cut on Tuesday morning. Following suit, the Bank of Canada cut its target for the overnight rate by 50 basis points on Wednesday, bringing it to 1.25 per cent. For the Fed, […]
Close to a quarter (23 per cent) of institutional investors said they plan to reduce their cash balances, according to a new survey by BlackRock Inc. For fresh allocations, private markets remain the favourite by a wide margin. Indeed, more than half (55 per cent) of investors said they intend to up allocations to real […]