Pension funds currently face a multitude of challenges and risks. We believe liability hedging (also known as liability matching) is an effective way to help de-risk a fund.

This white paper explains why pension funds should consider liability hedging, how it works and the potential pitfalls to its successful implementation. We also explain that liability hedging is not a single concept but comes in all shapes and sizes depending on the type of pension fund involved, and the attitude of its trustees’ sponsors and members. The decisions and processes involved are not simple, we concede, but the improvement in the fund’s risk profile is generally well worth the effort spent.