Contributor: David G. Eichhorn, CFA
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Risk Premia Strategies – Beta Overlay 2.0?
The advent of investable risk premia indices brings beta overlay to a new level. These tools allow investors to adjust the pre-packaged factor weights of traditional asset classes toward a different weighting scheme based on priced factors and investors’ preferences. Portable Alpha For some time now, investors have recognized that separating alpha and beta can…
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Rebalancing? Don’t Forget Derivatives
January’s steep drop in equity prices and rise in bond prices mean that many institutional investors are thinking about the same thing: rebalancing. With such a divergence in returns between equities and bonds, asset owners are understandably looking to get their portfolios back in line with their allocation targets. The problem is that not all…
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Here’s an Idea to Potentially Enhance Your Cash Returns
Returns will be hard to come by in 2016. That is perhaps the least controversial prediction we can offer for the New Year. Though modest, we do have one suggestion for potentially improving an investor’s overall return: consider substituting Treasury Floating Rate Notes (FRNs) for T-bills/Short Term Investment Fund. FRNs have several features that make…
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The Great Migration Toward Fixed Income
Since the New Year is always a time for reflection, and we are pension geeks, we thought it would be interesting to take a look at how the biggest defined benefit corporate plan sponsors have shifted their plan allocations over the last decade. Using company filing data gathered for our Pension Surplus Risk Index, we…
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Live (Less) Long and Prosper?
Working in the pension industry, it can be confusing to know which side to root for when new longevity projections come out. And when the Society of Actuaries released new mortality projections in October1 that predicted lower life expectancies than previously indicated, our reaction was decidedly mixed. While as human beings hoping to live to…
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The Full Picture on Partial Buyouts
We hear annuity buyouts frequently discussed as a silver bullet to reduce pension plan risk. Whether buyouts are the right de-risking option was the main topic at the October Pension & Investments’ Pension Settlements Strategies Conference , which we cosponsored for the third year in a row. Judging by the interest we saw at the…