PRT Ready? Private Commitment Pacing in a World of Higher Funding Ratios
We examine how DB plan CIOs facing high funding ratio and a PRT might “get ready” for portfolio challenges by adjusting their private asset commitment pacing.
Given the growth in illiquid asset allocations, good portfolio liquidity management must integrate a fund’s liquidity demands and sources over a long horizon and measure the consequences of large external liquidity demands, especially in adverse markets.
A strong liquidity management role would quantify a fund’s liquidity risk across many scenarios and identify at-the-ready external liquidity facilities.
High-quality liquidity management can enhance portfolio performance by recognizing the opportunity cost of holding too much liquidity.
Reprinted with permission from the Nummer 2 2023 edition of Financial Investigator.
The IAS team conducts bespoke, quantitative client research that focuses on asset allocation and portfolio analysis.
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We examine how DB plan CIOs facing high funding ratio and a PRT might “get ready” for portfolio challenges by adjusting their private asset commitment pacing.
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