Institutional investors

Does equity have duration? And if so, is it useful for LDI? June 2010 James Gannon Manager, Consulting & Investment Strategy Many defined benefit plans are seeking to implement liability-driven investing (LDI) programs. Could equities help plan sponsors hedge their liabilities? This paper provides an answer to the question and also discusses: The importance of similarity between hedging assets and liabilities, Duration and credit characteristics essential for hedging assets, Credit considerations, Key rate durations relative to cash flow payments, and Defining characteristics of equity durations versus fixed income durations. Request this research A note about our research Our proprietary research is made available to our institutional clients, and many of these published papers are available to other institutional investors as well. If you are not a Russell client, but are an institutional investor, we welcome you to request this research piece. We only require your contact information on a short request form. For more information about our research, please contact David or Gerry:     West Coast David Rothenberg Managing Director 866-926-5934 East Coast Gerry Lillis Director 866-459-4128 Nothing contained in this material is intended to constitute legal, tax, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional. Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company. Date of first use: June 2010 USI-7035			Request this research Printer friendly version of this page