The information in this site is intended for consultants, institutional investors and trustees only.

The information contained in these pages must not be used or relied upon by private investors. We recommend that you read our 'Terms & Conditions' before browsing the site.

Please click submit to confirm that you are a consultant, institutional investor or trustee and wish to continue.

Audience

Cashflow solutions in action: from LDI to physical bonds

05/06/2019

How do cashflow solutions work in practice? This case study shares our recent work with a large UK defined benefit pension scheme to transition from significant swap exposure to a cashflow solution based on physical assets.

  • A pension scheme’s transition to a fully cashflow-driven mandate is evolution rather than revolution, usually a series of events over time
  • We worked with the trustees and consultant of a large UK defined benefit pension scheme to reduce the complexity of the scheme’s liability-driven investment (LDI) portfolio and increase investment in physical matching assets
  • We substantially simplified the scheme’s interest rate and inflation swaps, which resulted in the release of a significant amount of gilts from the collateral portfolio
  • The transition to physical bonds offered the scheme potential for additional yield and opportunities to smooth the cashflow profile

Read more

Cyveillance Protected

For institutional investors only. Not for onward distribution to any other type of client. No other persons should rely on the information contained on this website.