Strategies & Capabilities

Cashflow Driven Investing

Many pension schemes face challenges in meeting obligations amid difficult market conditions, therefore liquidity planning is an important consideration as schemes mature.
We have a long heritage of fixed income investing which forms the core of our CDI approach, providing:

a low risk/low governance approach
an investment process that benefits from both quantitative and fundamental insights
a rigorous ESG screening process

Our innovative CDI approach

We have developed CDI solutions that allow investors to reliably manage their cashflow obligations using a liquid, diversified and transparent approach, regardless of their scheme size.

Our CDI investment approach is built upon four pillars:

Our Solutions

Our solution can be applied in either segregated or pooled fund structures, as below:

Segregated

For larger portfolios, clients can set their own cashflow requirements, as well as bespoke portfolio constraints

Set your cashflow requirements and tolerances
Customise your own constraints:
1. Ratings constraints
2. Sector constraints
3. Maximum allocation to foreign currency bonds
4. Custom exclusion list or ESG screens

Pooled Fund

Our CDI funds can be combined to match a desired liability profile and also blended with LDI to deliver a comprehensive solution

Three maturing funds with 5-year ranges
Funds distribute coupons and principal
Allocation to each fund tailored to your needs

Related Insights

The DB End Game — Helping Schemes Prepare for the Finish Line

Recent years have seen trustees and corporate sponsors of defined benefit (DB) schemes explore ways of managing and reducing risks as they meet their obligations to members.

Get In Touch

To learn more about our Cashflow Driven Investing approach please contact us

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These investments may have difficulty in liquidating an investment position without taking a significant discount from current market value, which can be a significant problem with certain lightly traded securities.

Equity securities may fluctuate in value and can decline significantly in response to the activities of individual companies and general market and economic conditions.

The views expressed in this material are the views of the Liability Driven Investing team through the period ended 28 February 2021 and are subject to change based on market and other conditions. This document contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected.

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This information is for informational purposes only, not to be construed as investment advice or a recommendation or offer to buy or sell any security. Investors should always obtain and read an up-to-date investment services description or prospectus before deciding whether to appoint an investment manager or to invest in a fund. Any views expressed herein are those of the author(s), are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may make different investment decisions for different clients. There are no guarantees regarding the achievement of investment objectives, target returns, portfolio construction, allocations or measurements such as alpha, tracking error, stock weightings and other information ratios. The views and strategies described may not be suitable for all investors. SSGA does not provide tax or legal advice. Prospective investors should consult with a tax or legal advisor before making any investment decision. Investing entails risks and there can be no assurance that SSGA will achieve profits or avoid incurring losses.

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