Actions almost always have unintended consequences. Such has been the case with pension funds increasing allocations to private assets over the past three decades. While they succeeded at what they were meant to do – uphold funds’ risk-adjusted returns – large allocations to private assets have left many plans with an illiquidity problem that is becoming more acute as they and their memberships mature.
Fund managers and trustees need a new toolkit, first to understand the current and future illiquidity risks they face, and second, to identify ways to manage the illiquidity problem. To address this challenge, we teamed up with our client CalPERS to work on an approach to help capture liquidity dynamics in our ALM model.
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Maurits van Joolingen
Business Development
Elwin Molenbroek
Senior Consultant North AmericaRelated Insights
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