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    Liability-driven investment

    Liability-driven investment

    LDI is a governance and risk management framework which puts liabilities at the center of decision making. It recognizes that your risk and return objectives are best measured relative to your unique liability profile and that it is ultimately the outcome that matters to your beneficiaries.

    Addressing your changing focus as your pension plan evolves.

    Early in the life-cycle, plans tend to be open to new participants and have long time horizons before liability cashflows become due. Their investment goal may be simply to maximize returns while removing uncompensated liability risks.

    As liabilities increase, a plan’s funded status can have a significant impact on its sponsor’s balance sheet and required contributions. This often leads to a focus on managing funded status volatility by striking a balance between return-seeking and liability-matching assets.

    For maturing, closed or frozen plans, liabilities are largely crystalized and cashflows are more predictable. Plan sponsors tend to emphasize locking down the target outcome while efficiently meeting cash outflows.

    Whatever the circumstances of your pension plan, we believe we can help you achieve your goals with greater certainty.

    An LDI partner for your evolving needs

    With $534.7bn of LDI assets under management1, Insight offers a full range of LDI capabilities. Our outcome-oriented solutions built from specialized fixed income and derivatives expertise, help you to address your risk and return objectives along your de-risking life-cycle, minimizing the trade-offs you face.


    Putting liabilities at the center of your decision making

    We offer a full set of liability risk management capabilities. These can be deployed as simple scalable ‘building blocks’, or we can fully customize a solution to meet your bespoke needs and unique liability profile.

    Your investment outcome and governance framework can be enhanced by applying a range of approaches. We can help you:

    • remove uncompensated sources of risk
    • make your investment strategy more ‘liability aware’ or implement a more comprehensive liability-matching program
    • fully ‘complete’ your liability strategy and hedge across multiple portfolios and asset managers

    We can add precision where it matters, including approaches that:

    • implement custom benchmarks to incorporate your discount curve
    • hedge the risks of more complex liability structures and profiles
    • manage assets directly to your liability cashflows
    • lock down your outcome with self-managed run-off portfolios (also known as ‘hibernation’ or ‘self-managed defeasance’)

    Our cashflow-driven investment (CDI) strategies seek to help you to meet your obligations as they fall due, without impairing your ability to generate your required return or to control liability risks.

    Many pension plans are now starting to pay out more than they take in. This has three important implications:

    • as assets shrink, percentage returns translate to lower dollar returns – meaning preserving assets and avoiding drawdowns can be crucial
    • as a plan matures, a shorter investment horizon makes the timing of returns more critical – with less time to recover any negative performance before liabilities fall due
    • as cashflow obligations come due, investors may be forced to sell assets to meet them – doing so in stressed market conditions can permanently damage the expected asset base and future return potential

    To meet these challenges, we can help you to:

    • generate cashflows required to pay obligations: this is achieved by sourcing assets and asset classes which generate contractual cashflows, prioritizing those with higher certainty of income and maturity proceeds
    • secure returns with greater certainty: by identifying and prioritizing assets high up in the capital structure and holding these investments to meet your liability outflows
    • reduce the mismatch between your liabilities and investment strategies: minimizing reinvestment and forced-selling risks

    We can help you set your strategic endgame target and adapt your portfolio to achieve your funding goal with greater certainty.

    Whether your target is buy-out or self-managed run-off (also known as hibernation or self-managed defeasance), our holistic framework seeks to increase the certainty of achieving your liability outcomes. It considers:

    • locking down the liabilities: Recognizing that it is difficult to invest against a moving target we can help you to lock down as much risk affordable or feasible through liability matching and hedging strategies
    • solving the deficit problem: We understand that many plan sponsors wish to mitigate or minimize contributions. We can therefore help you to build high-certainty solutions sufficient to deliver your required excess returns while controlling risk
    • managing uncertainty: We believe the most significant risk is the occurrence of a shortfall relative to achieving your strategic outcome. Investment strategies need to be resilient in the face of an uncertain future and that building solvency buffers are long-term desirable

    Whatever your pension plan’s ultimate objective, we believe applying this framework and managing the trade-offs you face on an ongoing basis will help you achieve your goal with greater certainty.

    Meet some of our team

    Our LDI capability rests on the experience of 169 fixed income investment professionals and 64 solutions specialists – with wide-ranging expertise across fixed income and derivatives markets as well as actuarial principles1, applied to pension risk management.

    Ciaran Carr, CFA

    Head of Client Solutions Group, North America

    Ciaran Carr, CFA

    Head of Client Solutions Group, North America

    Ciaran joined Insight in May 2023 as Head of Client Solutions Group (CSG), North America, with responsibility for our Client Relationship Management, Client Service and Solution Design teams.

    Prior to Insight, Ciaran was Head of Solutions Strategy for Legal and General Investment Management (LGIM) America where he built out a successful business in LDI and fixed income within the US market. Ciaran’s responsibilities included investment strategy across LDI, derivatives overlay, active fixed income, index solutions, responsible investing and private credit, and he played a key role in building relationships with clients and consultants to develop a strong business franchise. Ciaran also held the following positions with LGIM: Senior Solution Strategist, Interim Chief Investment Officer for L&G Re (secondment from LGIM), Portfolio Construction Associate and Insurance Solution Analyst.

    He holds an MA degree in Economics and Mathematics from The University of Edinburgh and he is also a CFA charterholder.

    Shivin Kwatra, CFA

    Head of LDI Portfolio Management

    Shivin Kwatra, CFA

    Head of LDI Portfolio Management

    Shivin joined Insight in November 2017 as Head of LDI Portfolio Management for North America. Prior to this, Shivin was a senior portfolio manager at Goldman Sachs Asset Management, where he managed fixed income and LDI portfolios.

    He started his career within the Investment Bank at JP Morgan on the Structured Products and Derivatives Marketing team. He was a founding member of the pension advisory group at JP Morgan (which was acquired by Pacific Life) and Head of Direct Investments at Pacific Global Advisors (which was acquired by Goldman Sachs).

    Shivin holds a BSc in Commerce with a concentration in Finance from the McIntire School at the University of Virginia, where he was also the captain of the men’s golf team. He is a CFA charterholder and maintains Series 7 and 63 licenses from the Financial Industry Regulatory Authority and Series 3 license from the National Futures Association.

    Erin Spalsbury, CFA

    Head of US Investment Grade Credit

    Erin Spalsbury, CFA

    Head of US Investment Grade Credit

    Erin joined Insight’s Fixed Income Group in August 2019 as a Senior Portfolio Manager responsible for managing credit portfolios, including long duration and customized bond solutions. Erin was promoted to Head of US Investment Grade in 2022. She previously worked at Conning, Inc. as a fixed income portfolio manager, where she managed credit liability-driven portfolios for pension and insurance clients. Prior to Conning, Erin worked at JP Morgan Asset Management as a fixed income portfolio manager, where she managed credit/customized portfolios for a full range of clients with a focus on pensions, and also handled credit trading. Erin holds a BA in Economics/Mathematics from Boston University and is also a CFA charterholder.

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