This document discusses the implementation of a dynamic de-risking pension risk management framework over the period from May 2008 to May 2013. It begins with an overview of the challenging economic landscape during that period. It then describes how the pension plan transitioned from an initial strategy with over 70% in equities and no clear risk management process, to a fully hedged strategy with 0% in equities and a well-defined risk management framework. Key steps included setting objectives, designing an efficient investment strategy, and ongoing monitoring. Through triggers linked to funding levels, the strategy de-risked the portfolio as the funding level improved to reach its targets of being fully funded at minimum risk.
Investment policy decisions are a vital part of a successful investment process for insurers. Related to this: Strategic asset allocation and how best to manage in a low interest rate environment.
Julia Butler - The Fiduciary Group - Best Practices for Meeting Fiduciary Dut...Downey Brand LLP
In her presentation at the 2015 Savannah Fiduciary Seminar, Julia Butler of the Fiduciary Group describes how plan sponsors, trustees, and investment committees can best meet their fiduciary duties to manage the plan’s investments. She outlines what should be in an effective Investment Policy Statement, and lays out the fiduciary processes to select, monitor, and replace the plan’s investment options. She also explains how a Section 3(38) fiduciary investment advisor can significantly reduce or eliminate a plan sponsor’s fiduciary liability for plan investments.
The distinguished lecture from the Executive Director, Wealth Management Head of South and South East UK at UBS, Martyn Begbour. Exclusively for the University of Southampton Investment and Finance Society.
Investment policy decisions are a vital part of a successful investment process for insurers. Related to this: Strategic asset allocation and how best to manage in a low interest rate environment.
Julia Butler - The Fiduciary Group - Best Practices for Meeting Fiduciary Dut...Downey Brand LLP
In her presentation at the 2015 Savannah Fiduciary Seminar, Julia Butler of the Fiduciary Group describes how plan sponsors, trustees, and investment committees can best meet their fiduciary duties to manage the plan’s investments. She outlines what should be in an effective Investment Policy Statement, and lays out the fiduciary processes to select, monitor, and replace the plan’s investment options. She also explains how a Section 3(38) fiduciary investment advisor can significantly reduce or eliminate a plan sponsor’s fiduciary liability for plan investments.
The distinguished lecture from the Executive Director, Wealth Management Head of South and South East UK at UBS, Martyn Begbour. Exclusively for the University of Southampton Investment and Finance Society.
Strategies for positive returns in volatile marketsnetwealthInvest
Part of Netwealth's portfolio construction webinar series - ST Wong from Prime Value presented to an audience on 14th June 2016 on the topic of absolute investing.
Netwealth portfolio construction series - Why you should consider investing o...netwealthInvest
Julian Beaumont from Bennelong Australian Equity Partners presented a webinar session on how to invest outside of the top 20 ASX stocks, for Netwealth on May 26, 2016.
How do Endowments Measure Up Against Cheap Market PortfoliosNeal Dikeman
Detailed analysis of portfolio returns and underperformance of Median US Endowments and Yale Endowment
Over 10 Years US Endowment Returns Fail to match Cheap Market Portfolios while Taking Significant Increased Risk
4.8% Compound Annual Returns for the Median US Endowment even failed to beat a portfolio of 10 Year Treasuries, let alone a balanced portfolio, while taking on significant risk
Underperformed cheap market portfolio by a 1/3rd with 3/5th more Risk
Returns barely exceeded average nominal withdrawal rates – asset growth largely from new donations
Asset Allocations/Market Timing largely to blame
As the US economic recovery gains momentum, unemployment is falling and consumer confidence is on the rise, creating a more conducive environment for carriers to market their products and services. This year’s Outlook discusses bigger picture issues likely to have a significant effect on consumer behavior and insurer operations in 2015 and beyond.
Strategies for positive returns in volatile marketsnetwealthInvest
Part of Netwealth's portfolio construction webinar series - ST Wong from Prime Value presented to an audience on 14th June 2016 on the topic of absolute investing.
Netwealth portfolio construction series - Why you should consider investing o...netwealthInvest
Julian Beaumont from Bennelong Australian Equity Partners presented a webinar session on how to invest outside of the top 20 ASX stocks, for Netwealth on May 26, 2016.
How do Endowments Measure Up Against Cheap Market PortfoliosNeal Dikeman
Detailed analysis of portfolio returns and underperformance of Median US Endowments and Yale Endowment
Over 10 Years US Endowment Returns Fail to match Cheap Market Portfolios while Taking Significant Increased Risk
4.8% Compound Annual Returns for the Median US Endowment even failed to beat a portfolio of 10 Year Treasuries, let alone a balanced portfolio, while taking on significant risk
Underperformed cheap market portfolio by a 1/3rd with 3/5th more Risk
Returns barely exceeded average nominal withdrawal rates – asset growth largely from new donations
Asset Allocations/Market Timing largely to blame
As the US economic recovery gains momentum, unemployment is falling and consumer confidence is on the rise, creating a more conducive environment for carriers to market their products and services. This year’s Outlook discusses bigger picture issues likely to have a significant effect on consumer behavior and insurer operations in 2015 and beyond.
Protect Your Assets - Equity Downside Hedging: presentation from the teach-in covering why tail risk hedging may be useful for institutional investors, types of strategies available and important things for investors to consider.
Post Merger Integration Toolkit - Framework, Best Practices and TemplatesAurelien Domont, MBA
This Toolkit was created by ex-McKinsey, Deloitte and BCG Management Consultants, after more than 2000 hours of work. It is considered the world's best & most comprehensive Post Merger Integration Toolkit. It includes all the Frameworks, Tools & Templates required to increase the value creation of your Mergers & Acquisitions. This Slideshare Powerpoint presentation is only a small preview of our Toolkit. You can download the entire Toolkit in Powerpoint and Excel at www.slidebooks.com
COVID-19 is an indicator of impairment of assets. In IFRS the measurement of impairment depends on the type of asset and hence various standards are relevant. Review the standards that apply and how impairment is measured under each of them.
In this paper we propose a new risk management framework that can evaluate the cost-risk tradeoff of alternative risk management strategies. Although there is ample theoretical support for risk management as an activity, common risk management approaches suffer serious problems:
Minimize Risk: Completely eliminating risk is expensive and impractical
Efficient Frontier: Can eliminate many poor risk management strategies but rarely gives a definitive optimal
strategy
Sharpe Ratio: Provides a cost-risk trade-off but the price of one unit of risk is arbitrary
Based on a recent empirical study, we propose a new cost-risk measure which directly values the impact of earnings per share and cash flow per share volatility.
This new approach will enable corporate CFOs and treasurers to make more robust risk management decisions and, critically, better defend those decisions internally and to the broader market.
The Impact of Technology on the Pensions IndustryRedington
The impact of technology on the pensions industry (past, present, future).
Prezi version: https://prezi.com/aadascppmnor/the-impact-of-technology-on-the-pensions-industry
Making Decisions; An Effective Trustee BoardRedington
What are the 10 core strengths of a Trustee Ninja?
1. Passion
2. Trust
3. Open Minded
4. Intellectual Curiosity
5. Numeracy
6. Collegiate
8. Prepare to challenge and be challenged
7. Seeing the wood for the trees
9. Prepare to stand out from the crowd
10. Make decisions and live with the consequences
"I haven’t told you the best part,” said Grandpa. “When you save your acorns, they don’t just sit there and wait for you. They grow into trees, and the trees give you more and more acorns.”
Join Oliver and Amelia as Grandpa teaches them the importance of saving. They hear the story of how the bears saved the monkeys. They learned about the consequences of wasting bananas, sharing berries and saving acorns. The best part is the acorns they save can grow over time into trees with more acorns.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
NO1 Uk Divorce problem uk all amil baba in karachi,lahore,pakistan talaq ka m...Amil Baba Dawood bangali
Contact with Dawood Bhai Just call on +92322-6382012 and we'll help you. We'll solve all your problems within 12 to 24 hours and with 101% guarantee and with astrology systematic. If you want to take any personal or professional advice then also you can call us on +92322-6382012 , ONLINE LOVE PROBLEM & Other all types of Daily Life Problem's.Then CALL or WHATSAPP us on +92322-6382012 and Get all these problems solutions here by Amil Baba DAWOOD BANGALI
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Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
how can I sell my pi coins for cash in a pi APPDOT TECH
You can't sell your pi coins in the pi network app. because it is not listed yet on any exchange.
The only way you can sell is by trading your pi coins with an investor (a person looking forward to hold massive amounts of pi coins before mainnet launch) .
You don't need to meet the investor directly all the trades are done with a pi vendor/merchant (a person that buys the pi coins from miners and resell it to investors)
I Will leave The telegram contact of my personal pi vendor, if you are finding a legitimate one.
@Pi_vendor_247
#pi network
#pi coins
#money
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
how can I sell pi coins after successfully completing KYC
Dynamic Risk Management in Practice
1. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Pension Risk Management Framework in Practice:
Dynamic De-risking Case Study
04 June 2013
1
2. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Contents
Introduction 3
Strategy Design 5
Implementation 10
Summary & Conclusion 16
2
4. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Case Study: The Journey
Before: May 2008
• No clear funding objectives or risk budget in place
• No monitoring in place
• Strained relationship with the sponsor
• Quarterly Trustee meeting
• Over 70% allocation to equities, hedge ratios close to 0%
4
After: May 2013
• A clear Pension Risk Management Framework (PRMF)
• Daily monitoring of funding level; quarterly monitoring of PRMF
• Improved relationship between Trustees and Sponsor
• Flexible governance schedule
• 0% allocation to equities, fully hedged against interest rates and
inflation
60%
65%
70%
75%
80%
85%
90%
95%
Fundinglevel
Original Strategy
Actual Strategy
De-Risking Triggers
De-Risking Triggers
Re-Risking Trigger
De-Risking Trigger
89.2%
81.0%
5. Teach-in Pension Risk Management Framework in Practice 04 June 2013 5
Strategy Design
6. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Process – 7 Steps Framework
6
To be fully funded at the minimum level of risk
Mission Statement
7. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Sample Pension Risk Management Framework
Step 1: Setting clear goals and objectives
7
Putting clients in Control of the Decision-Making Process:
We believe that the most effective way to ensure that the investment strategy remains relevant over time is the Pension Risk Management
Framework – a clear, strategic and market-consistent approach for capturing market opportunities and identifying, monitoring and controlling risks.
2013 2014 2015 2016 2017 2018 2019 2020
GBPMillions
Liabilities Path Actual Liabilities Assets Path Actual Assets
Contributions and
asset returns
Liability Basis
Time Horizon
8. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Strategic Asset Allocation
15%
10%
13% 19%
33%
1% 1%
13%
11%
4%
1%
0%
10%
20%
30%
40%
50%
60%
70%
1y VaR95 - Risk Attribution - New vs. Old Strategy
Step 2-4: Design and implementation of an efficient investment strategy
8
Implementation via a single manager
Reduce unrewarded risk
Increase rewarded risk
Equity
Futures
Active Credit Mandate
Buy-and-Hold Index-Linked Gilts Portfolio
Closely Matching the Liabilities’ Profile
Money Market Instruments
PooledSegregated
Active Credit Market
Key benefits
• Low governance solution
• Efficient collateral management for derivative positions
• Fully integrated platform to deploy future strategies
9. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Step 7: Ongoing monitoring
Calls to Action: Dynamic Risk Management Framework
• Disciplined yet dynamic approach to manage risk
• Triggers linked to “required return”
• Pre-approved by the Scheme actuary
9
Daily funding level trigger monitoring
• De-risking triggers implemented on a non-recourse basis
• Re-risking trigger to initiate “discussion”
• Quarterly monitoring of Pension Risk Management
Framework
75%
80%
85%
90%
95%
100%
105%
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Target flight plan
Dynamic
De-risking
Reach full
funding
faster
Funding Level Trigger Required Return Total Equity Exposure
As of 31 Dec 2010
87.0% 2.60% 50.0%
90.0% 2.30% 40.0%
92.0% 2.00% 30.0%
93.5% 1.70% 20.0%
95.5% 1.40% 10.0%
96.5% 1.10% 5.0%
97.0% 0.80% 0.0%
10. Teach-in Pension Risk Management Framework in Practice 04 June 2013 10
Implementation
11. 11
Portfolio Structure
An overview of the initial solution
Source: Schroders, Redington. For Illustration Purposes only.
Liability coverage obtained by corporate bonds and index linked
gilts not to scale
Liability
coverage
Investment
Liabilities Liabilities £92m
Equity Futures overlay
Corporate bonds Cash
Portfolio Structure
Corporate
Bonds
Index linked gilts
Index Linked
Gilts
Liability Risk Coverage
Corporate bonds and index-linked gilts
cover approximately half the liability risks
Corporate Bonds
Actively managed corporate bond funds
Index-linked Gilts
A bespoke portfolio, delivering stability,
certainty and low cost liability coverage
Minimal Cash holdings
Supporting the futures exposure, managed
to maximise liability coverage.
Bespoke equity exposures
A bespoke portfolio of equity futures that can be adjusted as the Plan’s requirements change
12. 12
Equity Futures Overlay
Maintaining a bespoke set of exposures
Equity region Future Allocation
UK FTSE100 25%-50%
Europe Eurostoxx50 16%-25%
US S&P500 16%-25%
Japan and Asia
Topix, Hang Seng, SPI
200
16%-25%
Total 100%
Example equity future exposures
Source: Schroders, Redington For Illustration purposes only
Maintaining growth exposure
To back the equity overlay the Plan can place:
– Index linked gilts for initial margin
– Cash for the rest (~20%)
– Profits can be passed into growth assets
– Too little cash => potential sale of bonds
assets
A bespoke exposure to equity futures
Schroders can deliver equity exposures specific
to the Plan’s requirements
Schroders will manage this process, (low
governance) whilst also giving the flexibility to
re-direct profits into other assets
Portfolio Structure
Equity Futures overlay
Corporate bonds CashIndex linked gilts
13. Schroder Matching Plus
Risk controlled and effective liability matching with pooled funds
Source: Schroders, for illustration only. The liabilities above are an example Scheme.
13
Portfolio structure Scheme’s liabilities
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
2011
2021
2031
2041
2051
2061
2071
LDI Interest rate coverage LDI Real Rate coverage
Fixed Pension Cashflows Index-Linked Pension Cashflows
Gilt-based coverage
Launched range in 2007, added Gilt funds in 2011
Robust and effective processes unchanged since
launch and throughout the financial crisis for:
– Liability coverage
– Counterparty risk management
– Cash management process
Flexible use of Total Return Swaps and Repo to
generate coverage
14. Schroder Matching Plus
Minimum capital requirement and robust solvency management
Other assets
Dynamic Allocation
Key :
Liabilities
Pooled Liability
Matching Fund Portfolio
Other assets
LDI Coverage
Portfolio Structure
Portfolio Management
Cash Holdings
20%
Interest rates fall / Inflation rises
Interest rates rise / Inflation falls
LDI
Portfolio
Note: Percentages shown above for illustration only. Actual amounts depend on the structure of the hedge
Source: Schroders, for illustration only
14
15. Keeps the Trustees in control of the solution
Client service
Funding level based monitoring and reporting
Schroders are delegated to:
Undertake daily monitoring of the funding
level, and
Adjust asset allocation automatically
Allows Trustees to focus on:
How well the solution is working
Which areas need attention
15
Source: Schroders. For illustration only.
-50
-25
0
Start Accrual at
disc rate
Hedge
A vs L
Differential
perf
Unhedged
liabilities
Excess
return
A vs L
net inflow
End
£'m
1
3 4
5 6
Liabilities
2
Trigger Proxy Funding
Level
DGF Equity
Futures
EM
EquityManager A Manager B
Current <87.5% 13% 14% 24% 3%
1 87.5% 13% 14% 20% 3%
2 89.0% 13% 14% 11% 3%
3 90.5% 13% 14% 6% 0%
4 92.0% 11% 14% 0% 0%
5 94.0% 7% 7% 0% 0%
6 95.5% 0% 4% 0% 0%
7 96.0% 0% 0% 0% 0%
17. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Integrity
clarity
simplicity
2008 2009 2010 2011
2012
and...
Scheme close to a full buyout;
no robust monitoring framework
Funding position significantly
deteriorated during financial
crisis
10 year recovery plan put in
place
Time for a change
Search for new investment
consultant
Redington selected after several
meetings to get comfortable with
“new concepts”
New investment strategy
implemented
Dynamic de-risking framework
in September 2010
New governance arrangements
and efficient monitoring
process
Four triggers hit by Feb-2011
and successfully captured
Three “Pension Awards” for
best investment strategy
Funding level deteriorated
again - governance
arrangements meant we could
act quickly
Funding level c8% higher
compared to original strategy
Risk (1y VaR95) reduced from
over 30% to under 10%
Fully hedged against interest
rates and inflation
18. Teach-in Pension Risk Management Framework in Practice 04 June 2013
Integrity
clarity
simplicity
A clear, focussed and disciplined approach to managing investments
A good and complementary skill set on the Board
A flexible and robust governance structure
Collaboration between all parties
Nothing stands still – we have to keep learning all the time
Keys to success
21. Teach-in Pension Risk Management Framework in Practice 04 June 2013
13-15 Mallow Street London EC1Y 8RD Telephone : +44 (0) 20 7250 3331 www.redington.co.uk
About Redington
21
Redington is an independent investment consultancy with a mission to design, develop and deliver the best investment strategies for its client to reach
their funding goals with the minimum level of risk. We combine the practicality of an investment banking approach to investment consulting with the best
of actuarial analysis, which delivers clients clear, actionable advice. Our clients trust us with over £250 billion of assets, and we advise ten of the 25
biggest pension funds in the UK.
Recent Publications IRIS: Monitor Risk. Measure Progress. Stay on Track.
Industry Awards
Risk Management Firm
of the Year
Best Consulting Firm
of the Year
Pension Consultant
of the Year
Investment Consultant
of the Year
Specialist Investment
Consultant of the Year