Crisis Team
Pension and Benefits
May 26, 2020

Founder’s KTAs from NeuGroup for Pension and Benefits 2020 H1 Meeting

By Joseph Neu The NeuGroup for Pension and Benefits 2020 H1 meeting took place last week, sponsored by BNY Mellon and their subject matter expert Insight Investment.  Here are a few takeaways I wanted to share:  Interregnum part 2. Insight Investment CEO Abdallah Nauphal put the Covid-19 crisis into the context of his thesis presented last October that the world is in an interregnum period between the financial-economic system that emerged from World War II and what comes next. Covid-19 is…
Capital MarketsNGIPension and Benefits
March 5, 2020

Actuarial Agony: Falling Interest Rates and the Plight of Pension Fund Managers

Private equity helps matters, but track records of outperformance don’t sway actuaries. Falling interest rates are pushing down the expected return on assets (EROA) at pension funds, an unwanted development for all managers and especially aggravating, perhaps, for those who have historically been able to outperform expectations. That was among the takeaways from a recent NeuGroup pension roundtable. Blame it on the actuaries. The pension fund manager at a major media company maintained an EROA of 7.5% over the last…
Capital MarketsPension and BenefitsRisk Management
February 25, 2020

No Slam Dunk for Pension Fund Managers: Selling Leverage-Averse Boards on Overlays

The popularity of overlays is increasing in the US despite concerns of executive committees. Leverage is something of a dirty word in the world of pension funds and that, perhaps, presents the biggest challenge that pension fund managers face when seeking to persuade their companies’ executive committees to use overlays that use derivatives as a fund-management tool.At a roundtable of pension fund managers arranged by the NeuGroup, one participant said his team had begun to explore how to “de-risk” the…