Pension Funds — The De-Risking Journey

Course Overview

While maintaining a traditionally low profile, in aggregate pension funds dominate the fund management industry in terms of overall assets under management. The course examines how pension fund management is evolving due to demographics, bond yields, government debt and sponsor financial pressures. It explores strategies sponsors are using to reduce risk and prevent pension obligations from becoming financial burdens.

Learning Outcomes

This programme provides insight into the de-risking journey many pension funds have undertaken. Market conditions continue to create challenges that are unlikely to deter fund sponsors and trustees from pursuing these strategies. Understanding these developments has broad implications for stakeholders.

Agenda

Programme 1

• The hidden time bomb and Covid-19 impact — sovereign bond yields; present value of long-dated liabilities; covenant risk; demographics and longevity risk
• Historic vs current asset allocation patterns
• Yield search in low-interest environments and alternative investments

Programme 2

• Liability Driven Investing
• Inflation derivatives
• De-risking strategies: Enhanced Transfer Values, longevity swaps, buy-ins vs buy-outs
• Wrap-up quiz