Strategic has been designing and implementing liability-driven investing (LDI) strategies for more than a decade. Our capabilities include asset/liability modeling and the development of customized LDI solutions, the design of glide paths to de-risk portfolios to a full-fledged LDI strategy, the construction and management of long-duration bond portfolios, and the use of portable alpha strategies to complement the beta exposures focused on minimizing funded status volatility.
Liability Driven Investments
Comprehensive Asset/Liability Management (CALM)
Strategic takes a comprehensive view of risk. We believe that it is essential to align the investment objectives of institutional portfolios with the institution’s broader mission, operations, and finances. We understand that an institutional investment portfolio is a means to achieve a set of objectives, not an end in itself. It exists in a financial context, and its purpose is to serve a broader mission. Strategic’s CALM approach guides the design of investment policies that are customized to serve the broader mission, thus improving investment governance and enterprise risk management.
Strategic’s Expert Tilt program seeks to strengthen the performance of a broadly diversified equity portfolio by introducing carefully crafted tilts toward tactically attractive segments of the public equity markets. These Expert Tilts tend to have high liquidity, low turnover, multi-year horizons, and a global opportunity set. Our analytical capabilities and operational infrastructure allow us to construct and manage these portfolios in-house.
Socially Responsible Investing
Strategic has in-depth experience in managing SRI/ESG strategies and prides itself on developing customized investment solutions in these areas. For over two decades we have partnered with our clients in embracing the challenge of achieving their investment objectives while maintaining consistency between their portfolios and their missions. In addition to crafting tailored approaches within equity and fixed income portfolios, we have designed innovative solutions in alternatives, such as hedge funds, which offer the potential to deliver a variety of uncorrelated streams of alpha while remaining true to our clients’ missions.
Strategic’s founders while at the World Bank, began investing in alternatives in the early 1980s establishing Strategic as an early investor in alternative asset classes. We believe we have built a reputation as a thoughtful, insightful investor who is often on the “first call” list of select managers. We construct alternative portfolios as an integral component of a global portfolio to ensure diversification and the potential for attractive returns, which together should improve portfolio efficiency. Within each asset class, we look for diversity in manager style and in timing and geography for draw-down sectors. Our investment professionals, lawyers, and due diligence experts assess the strategy, investment talent, organizational structure, and operational controls of managers in preliminary due diligence and ongoing monitoring.
Manager Development Program
Strategic’s Manager Development Program (MDP) facilitates investors’ search for talented new money managers. With Strategic as co-manager, the MDP identifies start-up and early stage investment firms, and typically acquires an equity ownership position in such firms. The MDP then assists these start-ups in transitioning into significant institutional money managers. Our MDP offers the potential to capture higher value added in portfolios managed by agile emerging money managers, as well as the potential to reap significant gains from acquiring ownership stakes in emerging investment management firms. Since 1987, Strategic’s investment team has helped incubate and develop a number of successful asset management firms. We have been proud to partner with these firms from the start-up phase through maturity.