Principal Strategic Asset Review is designed to develop and closely monitor a customized asset allocation strategy for defined benefit clients, targeted especially for plans with more than $25 million in assets, according to a news release. Among the services included in the product:
- an asset-liability matching study
- a customized asset allocation strategy
- a forecast for funding and expense information for the plan
- ability to develop a comprehensive investment policy for the plan
- optimization of the plan’s investment structure
- ongoing investment reporting and consulting services tailored to plan objectives.
Additionally, Principal Strategic Asset Review includes an asset-liability study and ongoing investment consulting services, which can be offered as a full package or unbundled to provide either service on a standalone basis. Thus, Principal Financial Advisors can team up with an investment advisor who may create an asset allocation service if only an asset liability study is needed or Principal can work with an outside actuarial firm that produces the asset-liability study.
Once complete, the asset-liability study sets a core asset allocation strategy using four main asset classes including US stock, fixed income, international stock and commercial real estate investment options. The client then selects the portfolio that matches their risk/return comfort level, funding preferences and plan objectives.