What is Liability-Driven Investing (LDI)?

This material is proprietary and may not be reproduced, transferred, or distributed in any form without prior written permission from Russell Investments. It is delivered on an "as is" basis without warranty. Liability-driven investing, or LDI, is an investment strategy that focuses on matching assets with current and future liabilities.

What is a defensive liability driven investing portfolio?

Defensive liability driven investing portfolios are Liability Hedging Portfolios. In general, the purpose of these portfolios is to safeguard against volatility by investing in stable, safer assets. These portfolios contain bonds and blue-chip dividend stocks, among other stable investments. They’re meant to offset losses incurred by PSPs.

Why should you choose Russell Investments for liability-driven investing?

To better manage duration and interest rate risk on plan liabilities. Why choose Russell Investments for liability-driven investing? Good strategy requires effective implementation that can both contribute to returns and reduce risk. This is where we excel.

What are the different types of Liability Driven Investing?

Bonds are the most common mode of liability driven investing. Coupon payments serve to generate income. Annuities are another example, as are dividend-paying stocks. However, most individual investors only need to adopt an LHP to fund their strategy.