Chairperson's Corner

by Hal Pedersen and Greg Roemelt

Risks & Rewards, December 2020



Editor’s note: This installment of chairperson’s corner combines the messages from the outgoing chair (Hal Pedersen, 2019–2020) and the new chair (Greg Roemelt, 2020–2021).


As your outgoing chair I am pleased to report that the Investment Section (the section) has had a very productive 2020. The section’s commitment to the Society of Actuaries Committee on Financial Research (CFR) has progressed and continues to work with CFR to fund and produce applied research of interest to section members. The section has produced another successful year of webinars across a broad range of topics including: COVID-19; Environmental, Social and Governance (ESG) Investing; Economic Scenario Generation; an Investment Boot Camp Series; and Investment Risk Management for Pension Plans. In 2021, a new webinar series on derivatives and their application will be offered, as well as professionalism webinars to help members meet continuing education requirements. The section has also established a subcommittee to find a way to deliver key economic data and an annual economic report of broad value to members. The section is also continuing to look for ways to partner with other professional associations such as the CFA Institute and the Global Association of Risk Professionals to broaden its reach and add value to members. If you have any suggestions or areas in which you would like to contribute, please reach out to incoming Chair Greg Roemelt ( or Section Specialist Ladelia (Dee) Berger ( It cannot be overemphasized how much your involvement is valued!

The current economic circumstances are the most interesting I have seen in my nearly 30 years as a financial economist. Not only is there a return to zero short-term interest rates, but BBB corporate bond spreads are at record lows and federal debt levels at record highs. On top of that, the electorate seems to be caught in a debate about whether capitalism or socialism is the way forward. I have no idea what the next decade will bring, but I do know there is always some problem to overcome. Furthermore, I am certain that investment professionals will have a vital role to play in navigating insurers and pension plans through this period.

Actuaries have a very proud history in investment risk management and interest rate risk management in particular. The term “immunization” was coined by the British actuary Frank Redington[1] whom the section honors with a prize in his name. The great economist and Nobel laureate Milton Friedman began his career as an actuary.[2] Paul Milgrom, FSA, is the joint recipient of the 2020 Nobel Prize in Economics for his work in auction theory. Thirty-five years ago he published “Measuring the Interest Rate Risk,” Transactions of the Society of Actuaries, Volume 37, 1985. It is a time of opportunity for Investment Section members to share experiences, educate the actuarial profession, and foster innovation in best practices.

Each year it is a joy to see the enthusiasm and energy from the section’s new council members.  The section is very fortunate to be able to welcome a diverse group of newly elected council members:

  • Caroline Grandoit, CFA, FSA, CERA, ACIA
  • Jeff Jingyang Zhou, FSA, MAAA
  • Adam Malovance, ASA, CERA, CFA
  • Yan Wang, FSA

It has been a privilege to serve on the council with so many dedicated members, friends of the council and terrific staff support! I am particularly grateful to Ladelia “Dee” Berger for her efficient and cheerful collaboration that is vital to implementing section initiatives.


As your new chair, I’d like to thank Hal Pedersen for his tireless contribution to the Investment Section. Given the unusual and difficult circumstances in 2020, Hal did a marvelous job of directing the section council and both articulating and accomplishing its goals.

Going forward, I see three key areas of focus for the Investment Section:

  1. Continuing education for actuaries who are interested in becoming or are already working as investment actuaries. I see a wide range of actuaries, from investment newcomers to seasoned investment professions who could benefit from continuing education. I believe the council’s current education programs are adding value to the actuarial community and I believe we should continue and expand the current curriculum.
  2. Continued research into what drives capital market behavior.The current economic environment is unlike anything ever seen before. Trying to make sense of where rates and markets could go will require new tools and understanding. I believe the section is uniquely positioned to support these research efforts.
  3. Provide access to investment data to help actuaries develop investment related assumptions. As an investment actuary, I struggle to find good sources of data to develop and validate assumptions. As financial reporting becomes more reliant on asset/liability models, there will be an increased need to develop investment assumptions that are both reasonable and can be validated. For many years, the Society of Actuaries has provided data to support the development of liability assumptions. To the extent possible, the section should endeavor to provide data that can support the development of asset assumptions.

I look forward to working with the section council and membership on advancing these priorities.



Hal Pedersen, ASA, Ph.D., is director of the Actuarial Program at the University of California Santa Barbara. He can be reached at or

Greg Roemelt, FSA, is principal at Oliver Wyman. He can be reached at


[1] See chapter 3 of Panjer: Financial Economics, 2001, The Actuarial Foundation; for detailed background.