If you are a DB pension plan sponsor, your plan is likely invested in a traditional balanced fund structure. A mix of 60% public equities and 40% core fixed income has long been the recipe for achieving the required rate of return plan sponsors need to cover their benefit obligations. However, the current low-growth, low-yield environment is making it increasingly difficult to hit the mark, and this type of strategy completely ignores a plan’s unique liability profile.
Standard Life Investments has launched a series of target liability bond pooled funds, which are designed to make customized liability-driven investment solutions more readily available to small and mid-size DB pension plans.
Jim Keohane, president of the Healthcare Ontario Pension Plan (HOOPP), is credited with reducing the organization’s investment risks, which helped the plan weather the financial downturn and come out well ahead of the market by 2009. In this Q&A, Keohane discusses his investment strategy and its application to HOOPP.
Originally from our sister publication, Investmentreview.com. Interest rate risk and liability driven investment (LDI) have made headlines in the last few years. There is even talk now of versions 2.0 or 3.0 of LDI strategies. Implementation of such strategies has certainly been delayed in the current low-interest rate environment. However, it is believable that, at […]
The CBC/Radio-Canada Pension plan has led the way with its LDI strategy, but public sector plans have also faced some tough critics and even tougher markets. Debra Alves, the plan’s managing director and CEO, describes the challenges of managing a public sector pension plan in a rough environment. How would you respond to critics of […]