The All-Weather Strategy might not be the best strategy for private investors with a long term horizon. Users are advised to periodically review the contents of this Website to be familiar with any modifications. The 10-K filing did not provide asset allocation information. Main Office In order to reduce the volatility of the investment portfolio, which is very crucial for pension funds to avoid any underfunding, the asset allocation in 2018 in USA is more like 50% stocks … Table 1 (below) shows the return and volatility of different asset classes from 1994 to 2017. Jeremy Chan | Sponsored by Oracle Financial Services, Enhancing your strategic position: Digitalization in Treasury, Netting: An Immersive Guide to Global Reconciliation, Get the latest analysis and reports delivered to your inbox daily, Unlocking the path to clarity in cash management through virtual accounts, Challenger banks “haven’t spent a minute” thinking about profitability, To improve e-invoicing, we must facilitate the onboarding and invoice creation processes first, Digital trade finance needs ‘rules of the road’, Treasury management systems must adapt, not stifle, What compliance means for electronic invoicing, 43% stocks, 55% T-Bonds and L-Bonds, T-Bills 2%. All other trademarks are those of their respective owners. Tenth Floor The cookie will expire after six months, or sooner should there be a material change to this important information. I back-tested four different investment strategies: In the past the 60% stocks and 40% T-Bonds investment strategy was the most common strategy among pension fund investment managers. Continuing the trend from last year, average equity allocations have ticked downward from 28% to 25% (seen further in Section 8), while average bond allocations have increased from 51% to 53%, and average alternatives allocations have increased from 17% to 18%. Chicago, IL 60601, CalPERS takes off interim tag on governance position, Missouri education system appoints executive director, U.K. deficits worsen in October as COVID-19 resurgence bites, Phoenix bricklayers, Detroit carpenters apply for MPRA cuts, Sponsored Content: DE-RISKING SPECTRUM INVOLVES A SERIES OF CHOICES, Sponsored Content By AXA Investment Managers, Pandemic drives faster transition for Virginia to private markets, Mubadala draws on portfolio in coronavirus fight, Texas Muni reduces downside risk during pandemic, finding opportunities now, ‘Triage plan’ at Indiana system helped stem losses, Ontario Teachers, ADIA invest in Asia-focused infrastructure firm, Varde closes COVID-19-related dislocations fund at $1.6 billion, Fresno County launches shortlist search for private credit, Blackstone adds global head of real estate ESG, Spokane Employees narrows field for consultant, Quantum Advisory picks principal investment consultant, Lower incentives expected again in money management, U.K. master trust default funds overcoming COVID-19 impact, LGIAsuper sets new strategic asset allocation, Retirement issues will remain in place, even if the politicians change, Pooled employer plans making splash as more firms dip toes into the water, Pooled employer plans and association plans, Willis Towers Watson acquires analytics firm Acclimatise, U.K. takes lead on mandating climate change disclosure, Climate change added to Fed's financial risk report, Big fund providers back 40% of 48 key resolutions on diversity, social justice, Groups combine forces to improve the profile of Black women in finance, CalSTRS leads effort to hike corporate oversight, AJO will close, but its cartoons will live on, Dalio Philanthropies grants $50 million to N.Y. hospital, Crispin Odey steps down as co-CEO of firm he founded, Brevan Howard reappoints portfolio manager, Hedge funds in biggest dollar short since 2017 risk squeeze, Commentary: Private credit – accessing opportunities outside of the mainstream, White House curbs Americans' investments in China, More SEC scrutiny of private funds expected, former officials predict, Standard Life Aberdeen plans passive embrace, Investcorp taps managing director for North America private equity, Big jump in private equity AUM expected over next 5 years, Thoma Bravo takes in $22.8 billion for 3 funds, Data, technology become new prized possessions, Neuberger’s Dyal extends deal streak with Veritas Capital stake, AllianceBernstein launches European real estate debt unit, Social issues take center stage at conferences, PGIM Real Estate adds head of debt investment research, Asian investors looking past disruptions to student housing, Labor Department finalizes pooled plan provider registration rule, DC providers urged to simplify explanations to participants, The pools open soon, and everyone will be welcome, Most used mutual funds by DC plans and target-date strategies, Collected coverage of P&I's 2020 WorldPensionSummit, COVID-19 puts new opportunities and risks on the agenda - WPS panelists, Private assets will continue to grow in portfolios – WPS panelists, Q2 2020 searches and hires overview report, Q2 2020 money manager M&A activity summary, Q1 2020 searches and hires overview report, MainePERS commits $75 million to infrastructure, Tarrant County Hospital District scouting for record keeper, Riverside, Calif., 457 plan looking for consultant, Georgia Peace Officers nabs 3 for smidcap equities, Discretionary and Advisory Investment Consulting Services, Vaccine trial results causing massive market moves, Defense dollars among developed countries, Modest interest rate increase helps lagging bank stocks, Eaton Vance asset growth partially due to acquisitions, Institutional Investors: Shared Expectations, Divergent Paths, P&I always will be looking for the next innovators, Getting governance right key for public pension plans, EM ESG Fixed Income Strategies Pass Their First Stress Test, Commentary: Investors beware of ESG fund ratings, Commentary: One size does not fit all – ESG analysis in fixed income, Commentary: Why Japan equities can generate sustainable returns for investors, Even as it assails China, Trump administration emulates it, Skeptical of Main Street support for proxy adviser proposal, Focus on manager diversity pushes asset owners’ to walk the talk, COVID-19 has shaken up high yield and changed up the investment ecosystem, The relevance of gold as a strategic asset, How sustainability will be fundamental to progress, Help us help you by supporting quality journalism, After the election is settled, big issues await, The Institutionalization of Retail: A Webinar Series from P&I Content Solutions and Chestnut Advisory Group, Target Date Construction and Its Impact on Outcomes, Carving out fresh opportunities: Don’t let cash drag you down, Investing Beyond the Pandemic: A Reset for Portfolios, POLL: Money managers' priority in Asia-Pacific region, POLL: Retirement issues in the presidential election, POLL: The effect of U.S.-China tension on investments, Caterpillar to seed pension plans with $145 million in 2020, PACCAR to contribute up to $120 million to pension funds in 2020, BAE Systems to arm pension plans with $1.6 billion in 2020, Gold mining’s contribution to the UN Sustainable Development Goals, Trends in DC: DC Plans Pass Pandemic Test, LDI immune to COVID-19 but lack of diversification persists, Managing Stable Value in an Environment of Heightened Risk, Uncertainty. You must not redeliver any of the pages, text, images, or content of this Website using "framing" or similar technology. Pension fund managers must take into account the variability of the portfolio returns from one year to another and here is the All-Weather portfolio superior. The study includes an analysis of the seven largest markets (the P7) which includes Australia, Canada, Japan, Netherlands, Switzerland, UK and US and comprises 92% of total pension assets. Past performance is not indicative of future results. It consists of: The high allocation of bonds in the All-Weather portfolio might surprise but the reason is the balancing of risk. 685 Third Avenue No WarrantyThe Contents are published in good faith but no advice, representation or warranty, express or implied, is made by BlackRock or by any person as to its adequacy, accuracy, completeness, reasonableness or that it is fit for your particular purpose, and it should not be relied on as such. The European Asset Allocation Survey provides a comprehensive overview of investment strategy across the European pension industry and attempts to identify emerging trends in the behaviour of institutional investors. Mercer report uncovers asset allocation and investment trends on nearly US$5 trillion [1] in assets under management (AUM) from government, corporate, and mandatory pension … This material is provided for educational purposes only and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Any changes to assumptions that may have been made in preparing this material could have a material impact on the investment returns that are presented herein. Intellectual Property RightsCopyright, trademark and other forms of proprietary rights protect the Contents of this Website. Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors. However the correctly diversified portfolio will prosper for eternity. He worked for international banks and multinational corporation gathering experience in P&L/risk management, M&A, investment strategies, negotiation, cash/currency management and cost control. %PDF-1.5 International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation, and the possibility of substantial volatility due to adverse political, economic or other developments. At the end of each year asset allocation changes according to market data and the desired allocation has to be achieved again. The information provided here is neither tax nor legal advice. The European Asset Allocation Survey provides a comprehensive overview of investment strategy across the European pension industry and attempts to identify emerging trends in the behaviour of institutional investors.