Montreal-based Standard Life Investments Inc. Wednesday announced the launch a series of Target Liability Bond Pooled Funds, making innovative and customized liability driven investment (LDI) products more widely available for small to midsized pension funds.
Standard Life says the new series of daily-valued Target Liability Bond Pooled Funds provide small to midsized defined benefit pension plans with access to an innovative and effective approach to de-risk their portfolios while optimizing long-term returns. The products will be available initially through Standard Life Investments and Standard Life’s Group Savings and Retirement Quality and Choice Investment Program.
“Canadian pension plans continue to face significant short and long-term pressures, including plan deficits, interest rate risks and longevity. But while the challenges are the same, each client is unique and needs a tailor-made solution,” said Claude Turcot, senior vice president, quantitative management, at Standard Life Investments, in a release.
Each fund in the Target Liability Bond Pooled Fund series is associated with a specific Canadian pension plan demographic profile representing different combinations of active employees and retirees. Pension plans can then tailor their allocation of assets within the series to reflect their own demographic profile and the duration of their liabilities. They can then establish the desired credit risk exposure. This series will provide small to midsized pension plans with access to a relevant benchmark reflecting their reality and customized risk exposure that aims to achieve sustainable long-term returns.
The new series of funds is comprised of a Short-, Mid- and Long-Term Liability Government Bond Pooled Fund.
A Short- and Mid-Term Corporate Bond Pooled Fund will also be added to the series and will be available through Standard Life once launched.