Manulife Asset Management will use RiskFirst’s risk analytics platform to help pension plan clients better understand their asset, liability and risk profiles, helping to enable more efficient liability-driven investing (LDI) and de-risking solutions.
RiskFirst’s risk analytics and reporting platform is known as PFaroe. Manulife says it hopes PFaroe will improve its ability to stress-test clients’ pension plans against economic and demographic assumptions—and explore the impact of alternative portfolio allocations in order to drive more effective solutions.
Eric Menzer, Manulife’s global head of pension and risk management solutions, explains that PFaroe allows for advanced scenario testing and helps plan sponsors “look at value-at-risk in a more holistic manner.”
“By helping clients to have a better understanding of the interaction between assets and liabilities, we can then implement even more effective solutions,” he adds. “This is a critical step in helping plan sponsors reduce funded status volatility, risks associated with large unexpected contributions and, ultimately, get to fully funded status.”
According to RiskFirst, PFaroe is an easy-to-use tool that fits well alongside Manulife’s proprietary LDI modelling and investment management capabilities.