Managing Investment Risks - Investment Advisory - Towers Watson

Managing Investment Risk

Today’s institutional funds face the challenge of successfully managing risk in a harsher return environment.

There is a growing awareness of the crucial role that governance plays in achieving investment objectives. The focus on asset allocation has intensified, with many funds shifting their allocations to bonds and alternative assets/absolute return strategies, among other things.

Meantime, investment efficiency has been enhanced by the use of a risk budget framework.

Featured

Is This the End of OTC Derivatives for Pension Plans?
Over-the-counter (OTC) derivatives, such as interest rate and inflation swaps, have become standard tools for defined benefit pension plans. But the recent financial crisis and subsequent changes in regulation mean it is likely that the way pension plans use such instruments will change.
Thematic Investing
Why is thematic investing a good idea? Our paper highlights potential investment themes we believe will be important in successfully shaping future asset allocation and risk management strategies.
Capital Markets Review - Fourth Quarter 2011
Towers Watson’s quarterly Capital Markets Review provides a high-level summary of capital markets and economic developments. February 2012.
January 1 Reinsurance Renewals on the ‘Firming Side of Stable,’ According to Towers Watson
Reinsurer exposure to severe event actual losses, the impact of the Risk Management Solutions' version 11.0, low interest rates that could impact earnings — and overall competitive pressures — combined to move January 1 renewal rates for U.S. property & casualty (P&C) reinsurance premiums anywhere from -5% to +5% on an overall basis, with loss-affected property catastrophe business up considerably more.
Stable-Value Strategies Becoming Riskier
The changing economic climate and greater regulatory uncertainty - combined with diminishing wrap capacity and consistently lower yields - have reduced the stability and value that investors can expect from stable value investment strategies.
Capital Markets Review - Third Quarter 2011
Towers Watson’s quarterly Capital Markets Review provides a high-level summary of capital markets and economic developments.

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