Optimising risk and returns relative to a future liability profile gives peace of mind to the benefit sponsor while at the same time addressing the future benefit requirement of each individual member.
We are able to do this through our systems, vast capabilities and years of liability-driven retirement investment strategies, including traditional cash flow matching strategies, as well as alternative return-enhancing approaches. Having direct access to a life insurance licence, investment teams focusing on active portfolio management, derivative experts and pension fund liability experts, we are able to implement unique, tailored solutions at a competitive all-inclusive fee.
What the fund aims to achieve and how
Appropriate assets are chosen to mitigate all the interest rate risk related to the liabilities.
This approach is similar to the Cash Flow Matching strategy with an additional overlay layer that allows the client to have some exposure to real assets.
Although all the interest rate risk is mitigated, an active investment decision is made to also invest in assets other than interest bearing investments thereby resulting in some short-term market risk, but higher future expected increases.
This strategy allocates assets between a Matching portfolio and a Growth portfolio. The Matching portfolio matches the client’s current liabilities mitigating all the interest rate risk, while the Growth portfolio determines the future increases.
The strategy is actively managed at all times to maintain the optimum allocation between the Matching portfolio and the Growth portfolio, thereby removing subjective investment decisions included in traditional enhancing cash flow matching or liability driven investment strategies.
Suitable for investors who
Preserves a member’s ability to purchase an inflation-linked annuity by closely matching movements in its benchmark index, the SALI Real, which tracks the changes in the cost of an inflation-linked annuity caused by changes in real interest rates.
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