Market volatility and uncertainty has led to greater emphasis
on using asset allocation models and other strategies to manage
the impact of downside and liquidity risks in long-term
portfolios and defined benefit plans.
Closing the funding gap: Implementing an LDI framework
Tony Gould, Client Portfolio Manager, Global Fixed Income, Currency & Commodities, pinpoints the key issues for pension plans considering a liability-driven investment program and explains the purpose of swaptions in LDI investing.
With the recent volatility in the markets, there is heightened
interest in investing in equity to generate income.
Learn how investors can make the most out of an equity income
strategy domestically and abroad.
In this "low for long" rate environment, generating high and stable income remains a challenge for investors. However, certain market dynamics are creating opportunities to pick up compelling yields across a range of asset classes, each with varying levels of risk-based capital intensity.
As part of a balanced portfolio, allocations to global asset classes such as REITS and commodities may help diversify and potentially bolster performance in a number of different macroeconomic environments.
J.P. Morgan Asset Management has more than 50 years experience managing corporate pension assets spanning a breadth of services including investment and cash management, advisory services, and asset allocation strategies for pension fund clients around the world.
After a frustrating 2012, with solid asset returns wiped out by liability increases amid declining rates, things may have turned around in 2013. The funded status of "Corporate America" improved over 9% from year-end 2012 through the end of May 2013 from 77% to 86%.¹
Through our global network of corporate pension specialists with expertise in asset and liability management and risk assessment, J.P. Morgan Asset Management seeks to:
Consider portfolio behavior and best hedging assets for inflation scenarios
Re-examine the benefits of traditional fixed 60/40 allocations as funding ratios evolve
Manage the volatility of funding ratios given equity and fixed income markets
Note: As of May 2013
¹ J.P. Morgan estimates using the Russell 3000 universe starting assets and liabilities, an allocation of 53% equities, 14% agg fixed income, 23% long duration fixed income, and other 11%. Barclays Long Corporate A or Higher Index used as liability proxy.
This website is intended to report solely on the investment strategies and opportunities identified by J.P. Morgan Asset Management. Additional information is available upon request. Information herein is believed to be reliable but J.P. Morgan Asset Management does not warrant its completeness or accuracy. Opinions and estimates constitute our judgment and are subject to change without notice. Past performance is not indicative of future results. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The investments and strategies discussed herein may not be suitable for all investors; if you have any doubts you should consult your J.P. Morgan Asset Management Client Advisor, Broker or Portfolio Manager. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice or investment recommendations. You should consult your tax or legal advisor about the issues discussed herein.
J.P. Morgan Asset Management is the marketing name for the asset management businesses of JPMorgan Chase & Co. Those businesses include, but are not limited to, J.P. Morgan Investment Management Inc., Security Capital Research & Management Incorporated and J.P. Morgan Alternative Asset Management, Inc.