While alpha is commonly recognized as a key lever in maintaining or improving funded status, it is often mistakenly limited to purely equity or lower-liquidity investment opportunities. For plan sponsors, this can be a costly misconception. Cambridge Associates’ research shows that active fixed income management can contribute valuable alpha, resulting in significant benefits to plan outcomes.
We build custom portfolios that help to achieve the outcomes and create the value each plan sponsor or pension scheme needs.
With more than 40 years’ experience in managing pension portfolios, we understand the complex challenges our clients face. Applying this knowledge on their behalf, we focus on achieving optimal results for each valuable unit of risk and capital.
Our client teams are led by senior investors and backed by experienced investment professionals. Together, each team partners with its client to help create a portfolio and relationship tailored to that pension’s current circumstances and long-term goals.
Our global footprint helps us to uncover areas of significant investment potential while our scale allows us to negotiate competitive terms for the benefit of our clients. This breadth of experience and resources allows us to construct truly differentiated portfolios designed to help our clients reach their targets while reducing downside risk.
We strive to align ourselves with our clients and don’t derive revenue from managers or other business agendas that might compete with you for our best ideas.
We serve diverse organizations and plan types, including:
- Government & Public Institutions
- Insurance Firms
- Multiemployer & Unions
- Not-for-Profit Organizations
- Defined Benefit Plans
- Defined Contribution Plans
- Cash Balance Plans
- Multi-Pool & Hybrid Plans
- Specialized Trusts
- Other Complex Asset & Liability Pools
As pension plan sponsors chart the path to achieving their funded status goals, Outsourced Chief Investment Officers (OCIOs) have increasingly been considered as a solution to portfolio management challenges. Yet despite their prevalence, many defined benefit plan sponsors have questions about what an OCIO does and whether the model can fit their unique needs. Sona Menon, Cambridge Associates' North American Pension Practice Head, draws on more than 10 years’ experience as an OCIO to address common concerns and illustrate the flexibility of OCIO relationships.Read the Article
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Although OCIO has become a buzzword across the broad investment community, many defined benefit plan sponsors have questions about how an OCIO affects a pension plan sponsor’s role as fiduciary and which elements are key to a successful OCIO relationship. Here, we answer 7 common plan sponsor questions on outsourcing.
The American Rescue Plan Act (ARPA) was signed into law on March 11, 2021, and included a variety of plan sponsor–friendly changes to single-employer and multiemployer pension plans, but no real help for public sector plans. ARPA may change the future landscape of US pension plans, which may prompt plan sponsors to modify their investment strategies to achieve plan objectives. Its impact will vary greatly, both by plan type and individual plan circumstances.
For many US pension plan sponsors, the déjà vu of falling discount rates and volatile equity markets again raises the question of how best to hedge pension liabilities, if at all. The issue of liability hedging is especially pertinent in today’s complex and asymmetrical interest rate environment.
As pressures on pensions mount, we believe financial executives are best served by re-evaluating major decisions in terms of the true tools at their disposal. In this paper we review four levers that are fundamental drivers of pension costs and outcomes: asset returns, liability hedging, contribution policy, and benefit management. Balancing these levers is critical to enabling greater probability of success in managing pension risk, and we introduce a framework for chief financial officers and other financial executives to use in doing so.
Pensions face critical investment and management challenges as COVID-19 impacts capital markets. For single-employer plans, we have found that liquidity, rebalancing, implementation and communication are key issues to keep in mind.
The construction and calibration of a liability hedging portfolio is integral to effective pension portfolio risk management, and this report delineates key considerations and best practices for the liability hedge allocation.