Client solutions

An array of timely and solutions-focused articles and whitepapers from our investment leaders and solutions team

Amid Global Uncertainty, What Role Can EMD Play in Insurance Portfolios?

In recent years, emerging market debt (EMD) has become a fixture in insurance general account portfolios, with investors drawn in by the possibility of a capital-adjusted return pickup and potential diversification benefits. It can also fit well into insurers’ asset liability management. However, as ever with insurers, it is not a case of one-size-fits-all. In our new Insights, we explore three parts of the insurance general account where EMD features and share our thoughts on three actions we think could benefit insurers under present conditions.

Liquid Real Assets are Built for These Times

The 2020s have seen revived and volatile inflation dynamics that institutional investors have been seeking to hedge by diversifying into real assets. However, these efforts have been confounded by a lack of liquidity in private markets. We believe the dual challenges of inflation and illiquidity can be overcome with a sleeve of liquid real assets, as Dave Chapman, CFA, explains in our new thought piece: Link

Combatting Complexity with Enhanced Beta

Two well-known trends have dominated asset allocation for the past two decades: the proliferation of private alternatives and the rising prominence of passive investing. The allure of each is obvious. The former offers attractive potential excess returns, while the latter saves cost in other highly efficient markets. However, these trends colluded, and the current market environment has revealed a growing number of challenges for managing portfolios with increasingly large allocations to both styles of investments. Fortunately, these challenges are met with opportunities. Below we offer observations from the market and our client conversations, and we also highlight two simple approaches to alleviate some of the pressure and complexity vexing allocators currently.

Borrowing Brilliance – Advantages in Fixed Income Portable Alpha

L&G – Asset Management, America is uniquely situated to be a partner on portable alpha because we offer an active strategy with returns in line with expectations and lower volatility, bring deep expertise in derivatives, and have a comprehensive understanding of managing risks around allocators’ policy benchmarks. While we are generally supportive of portable alpha, clearly not all implementations are created equal. Partnering with a portable alpha manager who intimately understands the trade-offs inherent in the approach may afford distinct advantages for retaining as much outperformance as possible for the overall portfolio.

The Contribution of a Constituent Time Period-Asset Pair: Longitudinal Decompositions

In the article, Revanta Pawar, Portfolio Manager in the Portfolio Solutions group, describes a new framework for isolating the contribution to a given portfolio metric – volatility, for instance – of each of the constituent asset-time period pair building blocks that informs its measurement.

25 min read

US Credit: The Case for American Exceptionalism

The US undoubtedly remains the dominant force in global markets, and for good reason. The economy is strong, and attractive alternatives – for now – seem few. Yet no narrative lasts forever, and it's especially important to question the narrative when a single thesis dominates. TINA has served investors well in recent years, but preparing for shifting landscapes is what separates reactive decision-making from thoughtful long-term strategy.

25 min read

Climbing a Ladder to Successful Outcomes

Are bond ladders under-utilized in the defined contribution space? We think so. Our latest thought paper co-authored by Jimmy Veneruso, Senior Defined Contribution Specialist, and Arin Bratt, Multi-Asset Senior Research Analyst, delves into the role bond ladders play in the drawdown phase within the defined contribution space.

25 min read

The Case for Investment Grade Private Credit within an LDI Portfolio

Interest in investment grade private credit strategies has been growing in recent years. 2024 could be the year where attractive market conditions intersect at the right moment within the evolution of DB plan sponsor’s LDI programs.

18 min read

Retirement Solutions, not Products

True retirement solutions involve not only solid investment products, but they must represent a holistic solution for participants. The solutions need to directly address the four fundamental risks participants face during drawdown in a clear and easy to understand way.

25 min read

LDI - Revisiting the Client-led Solution Framework

The trend toward LDI has accelerated as companies recognize that taking on non-core financial risk to leverage shareholder returns using the pension plan is less effective than leveraging returns in the core business. LDI can add value for all plan sponsors. For some plan sponsors, LDI is nice to have, for others LDI is critically important.

18 min read

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