FROM: Lisa Sorani, Manager of HR Employee Services LS -
FROM: Lisa Sorani, Manager of HR Employee Services LS -
FROM: Lisa Sorani, Manager of HR Employee Services LS -
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Institutional Investor Response<br />
• Most Institutional investors believe that inflation will pose some sort <strong>of</strong> threat at some point in the future<br />
• Many public pensions are putting the “tools” in place to deal with perceived risks such as inflation<br />
• The key to this approach is the have these “tools” ready and to “dial” them up or down in response to signs<br />
<strong>of</strong> these risks<br />
• Numerous public pensions have implemented a “Real Return” class as one <strong>of</strong> these tools<br />
• A prudently structured Real Return portfolio should diversify equity risk and provide inflation hedging<br />
• Designed to produce relatively stable returns and principal protection regardless <strong>of</strong> market<br />
environment and recover principal losses relatively rapidly<br />
17<br />
17
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