GLOBAL - A global poll carried out recently by SEI's Pension Management Research Panel has found the number of defined benefit pension funds using LDI strategies in five key markets has doubled since 2007.
In third place was the US - where LDI is a relatively recent phenomenon - with 36% of polled funds using LDI, up from only 17% last year. A further 38% of US funds stated they were considering employing an LDI strategy.
Hong Kong and Canada had LDI implementation levels of 28% and 27% respectively.
The poll also highlighted a change in the interpretation of LDI: while there was no consensus view on a definition amongst those polled, the most popular choice was 'a portfolio designed to be risk managed with respect to liabilities', which SEI suggested was evidence of "a more detailed understanding" than last year.
SEI claimed the poll also showed the Netherlands was the "most sophisticated and progressive pension market in the world", evidenced by the high numbers of funds turning to fiduciary managers and utilising a broad range of alternative products.
Bart Heenk, managing director of the Benelux region, SEI, commented: "Pension fund success is no longer strictly defined by managing nominal liabilities and many Dutch pension funds are using sophisticated strategies and products to manage real liabilities.
"The increased interest in managing risk is accompanied by a growing need for sound external advice and investment implementation, because the level of investment expertise and resources is daunting when added to fund design changes and new regulatory requirements like the FTK."
The SEI survey polled 160 executives in the Netherlands, the UK, the US, Hong Kong and Canada overseeing pension funds with from US$30m to over $5bn in assets under management.
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