Tuesday, January 30, 2007

P&I Top 1000

The annual Pension & Investments 1000 provides a good profile of the portfolio implementations of the top US pension plans. The Top 1000 corporate DB average asset allocation at 9/30/2006 was; US fixed income 26%, domestic equity 41%, international equity 16.5%, real estate 3.3% and 14.2% all other. A small year over year rise in corporate plan bond allocations was suggested as evidence that sponsors are starting to employ liability driven strategies. The relative level of indexing remained static, though an shift to more exotic “betas” has been observed. Enhanced indexing strategies grew as sponsors continued to look for opportunities to increase returns.

Of the top 200 Plans, 153 offer defined contribution plans. The aggregate aset mixes remained stable though diversified fund assets grew. 50 plans offered age based lifecycle or risk based lifestyle funds while 14 offered REITS and 13 offered TIPS. Index and enhanced index options grew as well.

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