Nuveen Adopts RiskFirst Technology to Enhance LDI Services

Nuveen Asset Management will use RiskFirst’s web-based analytics platform, PFaroe, to help craft customized liability-driven investment (LDI) strategies for institutional clients and corporate pension plans.

Nuveen anticipates as much as $1 trillion will transfer from equities to long-duration bonds over the next five years as pension plans and individual investors alike look to implement the principles of LDI, which involves better matching assets to projected liabilities (see “Client Demand Drives Consultant Focus on LDI”). Nuveen says the PFaroe product will be used by the firm’s recently formed Institutional Solutions Group as it builds and delivers LDI strategies for pension plans, public funds, foundations and endowments, insurance companies and other institutional investors.

“Over the next five years, we expect a $1 trillion move from equities to long-duration bonds, as corporate pension plans implement LDI strategies in a much bigger way than ever before,” says David Wilson, managing director and head of the Institutional Solutions Group at Nuveen Asset Management. “As rates rise and funded ratios improve, our team expects a considerable number of LDI programs to accelerate or start.”

The UK-based RiskFirst company, formerly known as PensionFirst, provides risk analytics software for various applications in multi-asset portfolio management and compliance settings (see “PensionFirst Broadens Focus to Become RiskFirst”). The firm says it is leveraging its strategic relationship with Winklevoss Technologies LLC, to expand operations in the United States. Its core product, PFaroe, is a real-time, web-based valuation, analytics and reporting platform designed to help institutional investors gain deeper insights into their risk exposure across multi-asset portfolios.

“As we built our technology platform, we found that there were good analytics systems on the asset side, and good pension liability systems, but there were very few that pulled both sides of the equation together on one platform,” Wilson adds. “[It’s] something we deemed essential to efficiently design LDI strategies on behalf of clients of all sizes. PFaroe does this, while also offering insight into the key risks that pension plans should be concerned with, all displayed in a user-friendly fashion.”

More information is available at the Nuveen Investments website and at