Description: Read the February 2020 issue of Risks & Rewards newsletter published by the Investment Section. Newsletters provide practical information for the working actuary, articles on trends that impact sections and news about section activities.

Description: Reviews anecdotal evidence that the current shift to passive investing is an indication that investors are irrationally ignoring market risk.

Description: Column from the chairperson of the Investment Section.

Description: Feature article discussing the current state of interest rates globally.

Description: The Long and Short (Runs) of Investing in Equities by Peter Yoo from Risks and Rewards Newsletter, March 1999, Issue No. 32.

Description: The impact of Fed’s QE program on the financial markets has been enormous and profound. The tapering and the eventual removal of the stimulus will be equally enormous and profound, and may be disruptive. To adapt to the potential regime change in near future, some investment strategies have been proposed: (1) shorten duration to focus on the short end of the yield curve and create laddered portfolios; (2) reduce allocation to high yield bonds; (3) rotate out interest rate sensitive sectors such as utilities; and (4) use interest rate derivatives to hedge the interest rate uncertainties lying ahead. On the other hand, contrarians who see the QE program continuing may stay the course and consider (1) adding duration, (2) gaining exposure to high yield bonds, and (3) increasing allocation to utilities and telecoms.

Description: Feature article discussing the too big to fail principle and whether or not strong competition is ideal in terms of the banking industry.

Description: Provides a technique for carrying out investment performance attribution reporting which provides stable, consistent results without residuals. Provides simple examples and a mathematical defense of the method. Illustrates implementation using numerical integration. Provides guidance to limit application of the technique when there are discontinuities in the underlying exposure.

Description: Argues public plans should only hold bonds, on the basis of tax and finance arguments.

Description: This articles explains why many corporations are making massive reductions in risk related to their pension plans despite the fact that this means locking in costs at a time of historically low interest rates. This should help actuaries working with pension plans or pension investments advise clients on investment strategies and other approaches to de-risking.