The Portfolio Management Committee presents:

2014 Annual Pension Conference
What’s next for Pension Plans?  “Right-risking” in Today’s Economic Environment

 

Date: Thursday April 24, 2014
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Event Overview
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Time: 8:00 AM - 5:00 PM
5:00 PM - 6:00 PM (Reception)
Location: The Board of Trade
First Canadian Place, 4th Floor
Toronto, ON
Event Type: Conference
CE Credits: Eligible for 7 CFA Institute CE credit hours
IIROC CE Credits May Apply
Eligible for Tuition Tax Receipts from T2202A
May be eligible for CE credits to maintain CFP® certification

Overview

Following a tumultuous economic period that witnessed sharp declines in funded ratios, Pension Plans have recently benefited from roaring equity markets and rising interest rates. The question on most Plan Sponsor’s minds is how to protect this sudden reversal of fortune; Plans are exploring everything from de-risking strategies to modifying their allocation to real assets and smart beta. This conference will explore many emerging tools and trends that Plan Sponsors are considering for managing plan risk.

Topics Include

• The economic outlook for equities and bonds
• How Plan Sponsors have approached de-risking their plans
• The increase of real assets and their effectiveness to diversify traditional allocations
• The role of smart beta in a diversified portfolio

Learning Outcomes

• Long-term global economic prospects
• High level overview of evolving governance structure of DB and DC plans
• Potential role of real assets in Pension Plan
• Smart beta as a diversifier

Agenda

8:00 AM – 8:25 AM
Registration & Networking Breakfast
8:25 AM – 8:30 AM Opening Remarks
Speaker: Marcus Turner, CFA, Chair, CFA Society Toronto Portfolio Management Committee
           
8:30 AM  – 9:30 AM

DB & DC /Governance
Speaker: Claude Lamoureux, Chairman, Inaugural President and CEO of Ontario Teachers' Pension Plan

Learn from one of Canada’s top business leaders and corporate governance advocates for an important discussion as he examines governance at OTPP, CPPIB, PSPIB, selected US funds and ideal DC plans.  
           
9:30 AM  – 10:15 AM

Illiquidity Premiums
Speaker: Andrew Ang, Ann F. Kaplan Professor of Business, Columbia Business School

What are the short-comings of commonly-used performance measures in private equity, real estate, and other illiquid asset markets? Learn from innovative techniques on constructing more accurate returns indexes for private equity based on cash flows received by limited partner investors such as pension funds and sovereign wealth funds. Ascertain knowledge on how to decompose private equity returns into a component due to traded, public-market factors, and a time-varying private equity premium.


10:15 AM – 10:30 AM Networking & Coffee Break

10:30 AM – 11:15 AM Over Exposure to Real Assets
Speaker: Joseph L. Pagliari, Professor, University of Chicago

Observe a thorough examination of the three components in the standard portfolio optimization technique as the investment horizon lengthens, the allocations to commercial real estate The reported returns on private-market assets (such as commercial real estate and private equity) often display high levels of autocorrelation. When different asset classes display varying degrees of autocorrelation, the investment horizon may substantially alter optimized mixed-asset portfolio allocations. Consequently, the one-year returns typically used in mixed-asset portfolio optimization procedures often generate excessive allocations to private-market assets.


11:15 AM  – 12:00 PM  

Practical Approaches to LDI for Pension Plans
Speakers: Jim Keohane MBA, CFA / Don Raymond, PhD, CFA

In this session, Jim and Don will discuss two different, but related approaches to managing pension assets relative to their liabilities. Jim will discuss HOOPP’s two-step approach to portfolio construction - first, the Liability Hedge Portfolio, followed by the Return Seeking Portfolio. Don will then discuss a 1-step, factor-based approach to LDI that, under certain conditions, results in the same outcome as the two-step approach.


12:00 PM – 12:15 PM  Networking Buffet Lunch

12:15 PM – 1:15PM Lunch - Guest Speaker
A Debt Constrained World

Speaker: Dr. Lacy Hunt, PhD, Economist
Learn how extreme over-indebtedness has played a significant role in diminishing the potential for economic growth and inflation. Join Dr. Lacy Hunt over lunch as he examines, through historical precedents and scholarly studies, if a massive debt overhang rendered monetary policy impotent and the role of debt in determining forex values and bond yields.

1:15 PM  – 2:05 PM European Economic Perspective
Speaker: William W. Priest, CPA, CFA, Chief Executive Officer, Co–Chief Investment Officer and Portfolio Manager, Epoch

Global economic conditions are a study in contrast. In the U.S., the real economy and the financial economy have temporarily taken different paths. Some European countries appear on the road to sustainable growth while others are stagnant or deteriorating. The success or failure of "Abe-nomics" may be decided in 2014, as Japan endeavors to counter-act labor imbalances, boost domestic consumption and bring to an end years of deflationary malaise. The common thread is that investors will have to adapt to economic growth that is slower than in past periods.


2:05 PM  – 2:50 PM  

Smart Beta: Factor Exposures versus Investment         
Speaker: Fabio Cecutto, CFA, Senior Investment Consultant, Manager Research, Towers Watson Investment Services, Inc.  
Over recent years market participants have been increasingly investigating the use of smart beta investing.
We are now at a stage where smart beta has moved beyond theory and there are several funds available today across several asset classes.

For something ‘smart’, the concept is really quite simple. Smart beta gives the investor the opportunity to capture a:
- wider spread of risk premia than conventional systematic strategies, or
- risk premium previously only available through expensive active strategies in a cheaper way.
           
Speaker: David Morris, CFA, GWA Founder and CEO

Beta has come to mean the return available to investors in any market or asset class and it is typically measured by a market capitalisation weighted index.

Smart Beta refers to an index that is not market capitalisation weighted. Since GWA launched the world’s first non-market capitalisation index with FTSE in September 2005, competition in this space has been intense.

Smart Beta’s popularity derives, in the main, from perceived weaknesses in market cap indices, poor performance by active managers, and low fees. To contend with the volume, Standardised groupings of Smart Beta have emerged, based on common underlying belief systems.

The majority of Smart Beta, although not market capitalisation weighted, nevertheless still relies completely on security price metrics. And this reliance on prices, ironically, is the very antithesis of its origin.


2:50 PM - 3:10 PM  Networking and Coffee Break           

3:10 PM  – 4:00PM The Problem with Public Sector Pension Plans
Speaker: Malcolm Hamilton, MSc FSA, former Partner of Mercer

Governments have mispriced pensions in setting employee compensation. As a consequence, public sector employees are paid more than they know and are able to shelter more of their income from tax than can their private sector counterparts. The problem can be traced to public sector accounting standards which, unlike private sector accounting standards, do not risk adjust the reported cost of pensions. This tempts public sector pension plans to take more risk than they should.


4:00 PM - 4:45 PM

Economic Review
Speaker: Douglas Porter, CFA, Chief Economist and Managing Director, BMO Capital Markets

There are many cross-currents buffeting the global outlook. These include the U.S. Federal Reserve dialing back the stimulus, to Europe’s steadying growth outlook, Japan’s massive stimulus, China’s longer term reforms, to the challenges here in Canada, including the housing market, and still-high household debt. Douglas Porter will address how all of these influence Canada and the U.S., and what it means for financial markets.              


4:45 PM - 6:00 PM  Closing Remarks and Networking Reception – Rooms A/B/C/D 

Who Should Attend

The conference is targeted to senior members of Plan Sponsors, Insurance or Banking asset managers and service providers in the finance industry.


Registration Information

Prices are subject to 13% HST
Early Bird Pricing (before Apr 11)
       Single Tickets Members $240 Non-Members $340
       Table of 8 Members $1820 Non-Members $2620
Regular Pricing (after Apr 11)
       Single Tickets Members $260 Non-Members $360
       Table of 8 Members $1980 Non-Members $2780

*Dietary Restrictions/Allergies: Please note, due to venue restrictions onsite meal changes/substitutions cannot be accommodated. If you or your guest(s) have any dietary restrictions or would prefer a vegetarian meal, please email your requests in advance to eventregistration@cfatoronto.ca by April 20.

For general registration information or to redeem your CFA Society Toronto voucher, please contact
eventregistration@cfatoronto.ca

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Media: Registration at this event is by special invitation only. 

     

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Registration Fee includes: A digital copy of conference material.

Cancellation Policy: CFA Society Toronto reserves the right to cancel a course that does not meet the minimum enrollment. In the event a course is cancelled all registrants will be contacted and 100% of your fee will be refunded.

Withdrawals/refunds:
Advanced written cancellation notice is required.  Refund amount is based on when notice is received.
Before April 10 (inclusive) - 100% refund will be issued.
From April 14-18 - An administrative fee of $200.00 will be incurred for cancellation or transfers.
After April 18 - No refunds or transfers will be allowed.
All refunds and fees are subject to HST
Cancellation notices may be emailed to eventregistration@cfatoronto.ca or faxed to 416-366-6716.


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