ST. LOUIS, June 22, 2021 /PRNewswire/ -- NISA Investment Advisors, LLC ("NISA") recently released a report on the unique position that many corporate pension plans find themselves in due to a confluence of positive factors. The analysis discusses why now may be the appropriate time for such plans to pivot to a lower risk portfolio comprised predominately of bonds – often referred to as a hibernation portfolio.
"Increased funded status, newly legislated funding relief, and historical contribution credit balances have created clearer skies and calmer waters for plan sponsors as we look forward over the next several years, from a contribution perspective," said David G. Eichhorn, CFA, NISA's CEO and Head of Investment Strategies. "Plans that are nearly fully funded or overfunded should consider accelerating their de-risking decisions to protect this elevated funded status and limit the potential for future contributions."
In 95 Is the New 105: Why Plans Should Consider Accelerating their Glidepath, NISA demonstrates the magnitude of these tailwinds, exploring the potential for contributions in the years ahead, measured as a percent of today's value of the liability, for five hypothetical corporate pension plans.
To view previous NISA Perspectives posts, including Much Needed Multiemployer Financial Assistance: But Don't Count on 30 Years, please visit our website by clicking here.
About NISA Investment Advisors, LLC
NISA manages assets for some of the largest institutional investors in the U.S. The firm is 100% employee-owned and based in St. Louis, Missouri. Client portfolios include investment-grade fixed income, derivative overlay, and equity investments. As of March 31, 2021, NISA managed $244 billion in physical assets and $173 billion in derivative notional value in separate account overlay portfolios. NISA's Pension Surplus Risk Index, or PSRX®, is a forward-looking estimate of the funded status of U.S. corporate defined benefit plans and is published monthly. For more information, please visit our website at www.nisa.com and be sure to follow us on LinkedIn.
Michael Herley for NISA Investment Advisors, LLC
email@example.com or 203-308-1409
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