A Review of the Goals & Objectives of Liability Driven Investing

Despite unexpected pieces of good economic news in March, including an uptick in new home sales and durable goods orders, the economy remains in dire waters, and asset values and funding levels of corporate defined benefit plans are continuing their 2008 dive. The long journey in troubled waters, which we first addressed in the January 2009 A/L Monitor Special Report, is getting bleaker by the month: according to Mercer, the aggregate funded status for S&P 1500 companies at the end of February stood at 74%, compared to 104% a year ago . The fall in equity markets – the S&P 500 index is down 9% for the year as of March 25 – is contributing to the pensions’ debacle, and plan sponsors are lowering their return targets.

  • DATE: December 31, 2009

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