Liability-Driven Investing

Focusing on the journey and the destination

The Pension Solutions and Liability-Driven Investing team addresses client needs through a diagnostic, collaborative approach that aids plans of all sizes and maturity stages. At the core of our capability are foundational equity, fixed-income, and asset allocation resources that skillfully deploy hedging and risk-taking expertise to achieve better outcomes. Our greatest strengths are our experience and flexibility in customizing solutions to deliver true partnership.

Recent insights:

Seizing the moment

LDI experts Andy Hunt and Jonathan Hobbs discuss the client journey to full-funded status.

Seizing The Moment

Andy Hunt, FIA, CFA: At Wells Fargo Asset Management, LDI is a solution. It is a partnership between us and a client to help figure out what they need to do, what they want to do, and what is possible. And putting those three together and journeying with that client over time is what LDI is all about. To my mind, it's not a product. It's a product plus a service. And that service is an ongoing and evolving one.

Jonathan Hobbs, CFA, FSA: Lately when I’ve been talking to clients about their funded status, there’s this huge sigh of relief of the increase we’ve seen over the last couple of years. But there’s also some trepidation about what’s next and we want to help them achieve their goals which are to get over that final hurdle of full funded status. So we’ve been talking to them about things like increasing the level of precision in their hedging program, about diversification of some of the bonds they’re buying in their portfolios. And then also about how do you take the growth portfolio from where it has been with a higher risk allocation to something more risk managed for the future.

Andy Hunt: Pension plans have been on a journey for a number of years. The journey has evolved. So what was important three, five, seven years ago is different. And what's important today is getting the implementation right, seizing the moment, taking those steps that you've actually been wanting to do for many a year but have been maybe unable because the opportunity hasn't been there... And then going forward, it is about effective implementation, taking strides to remember that a good LDI solution first and foremost has to be a good asset portfolio as well as talking to and echoing the needs and the risks of your liability. And I think implementation of good asset portfolios is where the game is at right now.

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Your plan’s risk signature

Our expert team can work closely with you to understand your plan’s needs and goals --to help you develop efficient ways to strive to achieve them. We can work with you to adjust your approach over time, to help you keep your plan aligned with your funding and investment needs while responding to changes in markets and regulations. We use a diagnostic process that includes a comprehensive analysis of your situation with a fully rounded exploration of your liabilities and asset risks. It clarifies the issues to be addressed, builds a common risk framework, and unearths key questions — providing you and us with the insight we need to develop effective portfolio solutions.

Mapping the journey

Pension liabilities are about the long term, and so is our relationship with you. The insights we gain working closely with you enable us to create solutions targeted to your true needs and investment views. We work with you to build diversified, actively managed, opportunistic portfolio solutions with strong risk management.

Customize your investment design based on your plan’s liabilities and need for growth and re-risking

Engage with our clients over time providing consistent monitoring and detailed reporting

Update and evolve your risk signature over time to adjust your portfolio when appropriate

Define your plan’s risk signature with a comprehensive asset and liability analysis

In working with us, you will be able to draw on resources from the full family of Wells Fargo Asset Management experts and investment strategies — including hedging, alpha/beta exposure, and fixed-income strategies managed actively in an effort to capitalize on the bond markets’ many inefficiencies. We work with you continually to reassess your needs, revise your plan, and implement solutions effectively.

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Your team of experts

Our seasoned specialists are service minded and are truly experts in pension solutions investing. You can rely on us to provide sound investment practices and maintain vigilance through changes. We are agile in our responses and are a dedicated partner at every step of the journey.