Cash Flow Matching Solutions
Our customized Cash Flow Matching Solutions synchronize cash flows and future liabilities through transparent, long-term frameworks built for managing risk to help ensure our clients’ financial goals are met. We structure bond maturities and interest payments to offer consistent income streams that meet known obligations, reducing the need for portfolio disruption and mitigating reinvestment risk.
Designed to Meet Long-Term Obligations
Our dedicated team of actuaries, credit researchers, and portfolio managers work collaboratively to construct portfolios that combine bonds and other carefully selected assets. The goal is to support the consistent payment of benefits, even during periods of market stress, while aligning with the evolving needs of plans as they mature. By integrating rigorous credit analysis, risk oversight, and forward-looking cash flow planning, we aim to provide clients with a resilient investment framework that balances stability, predictability, and long-term objectives.
Sources: Bloomberg, Barclays, Citigroup, Standard & Poor’s, Loomis Sayles. Analysts shown from 12/31/2000-12/31/2018
Chart is shown for illustrative purposes only. Sample portfolios created by Loomis Sayles based on a hypothetical pension plan using the Russell Cash Flow Generator which produces a generic set of pension liabilities. Analysis was done using the assumptions of a plan with a 12-year duration liability discounted using Citigroup AA Corporate pension discount curve. Immunized solution was constructed using high yield corporate bonds with maturity less than 5 years. The use of hypothetical scenarios has inherent limitations. They are heavily dependent on the assumptions used and do not take into account actual trading or market conditions. The portfolios constructed were created by projecting cash flows from the universe of bonds available on the date of analysis which includes assumptions about bonds cash flows that may not materialize in actual accounts. The hypothetical portfolios are intended to convey one measure of the characteristics of an asset class or combination of asset classes, and a different analysis may yield different results. Material market and economic factors may affect investment decisions differently when managers are investing actual client assets.
The ability of an actual portfolio to deliver the required cash flows is not guaranteed and is subject to a variety of factors including, but not limited to, the availability of bonds, active management, and trading, transaction costs, default risk, reinvestment risk, rebalancing risk and liquidity risk.
Any investment that has the possibility for profits also has the possibility of losses, including loss of principal.
Intended for Institutional Investors Only.
Unparalleled Institutional Knowledge and Experience
We combine deep credit research, actuarial insight, and seasoned portfolio management to serve pension funds, insurers, foundations, and other institutional clients. This integrated approach allows us to construct tailored solutions designed to meet precise payout and liability requirements.
Deep Credit Research
Our team of credit analysts conducts rigorous evaluations of every bond, ensuring reliable cash flows and informed investment decisions.
Integrated Teams
Actuaries, researchers, and portfolio managers collaborate closely to design, implement, and monitor portfolios, aligning strategy with client objectives.
Tailored Solutions
Portfolios are customized to reflect each client’s unique liability profile, payment schedule, and risk tolerance, providing a precise fit for institutional needs.
Ongoing Oversight
Our team continuously monitors portfolios, making adjustments as necessary to maintain alignment with client goals and evolving market conditions.
Guided by What Matters to our Cash Flow Matching Clients
Reliability
Cash Flow Matching offers consistent payouts, helping clients maintain confidence in their ongoing cash flows.
Alignment
Every portfolio is carefully structured to match a client’s specific liability schedule, ensuring all parties remain coordinated and objectives are consistently met.
Transparency
Clients gain clear visibility into how each asset contributes to meeting cash flow requirements, fostering trust and accountability.
Risk Management
Our Cash Flow Matching portfolios are designed to help institutional investors minimize reinvestment risk and manage exposure, providing a disciplined framework for liability-driven investing.
Flexibility
Our nimble, integrated teams can quickly adjust portfolios as client needs or schedules evolve, maintaining alignment without sacrificing efficiency.
Control
We provide guidance, knowledge and experience while allowing clients to retain full control over their cash flow strategy, ensuring decisions remain aligned with their goals.
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Interested in Cash Flow Matching Solutions?
Reach out to discuss options that can be tailored to you–our teams are ready to start the conversation.
Justin Teman, CFA, ASA
Head, Institutional Advisory Group
Important Disclosure
This marketing communication is provided for informational purposes only and should not be construed as investment advice. Investment decisions should consider the individual circumstances of the particular investor. Any opinions or forecasts contained herein, reflect the subjective judgments and assumptions of the authors only, and do not necessarily reflect the views of Loomis, Sayles & Company, L.P. Investment recommendations may be inconsistent with these opinions. There is no assurance that developments will transpire as forecasted and actual results will be different. Information, including that obtained from outside sources, is believed to be correct, but we cannot guarantee its accuracy. This information is subject to change at any time without notice.
Commodity, interest and derivative trading involves substantial risk of loss.
The ability of an actual portfolio to deliver the required cash flows is not guaranteed and is subject to a variety of factors including, but not limited to, the availability of bonds, active management, and trading, transaction costs, default risk, reinvestment risk, rebalancing risk and liquidity risk.
Any investment that has the possibility for profits also has the possibility of losses, including the loss of principal.
Diversification does not ensure a profit or guarantee against a loss.
Market conditions are extremely fluid and change frequently.
Past performance is no guarantee of future results.