Asset allocations: past, present and future

This presentation will review the changes P&I has seen in pension fund asset allocations, why those changes occurred and a likely direction for the future. The changes in the past five years have been dramatic. Among corporate defined benefit plans, the changes are arguably more dramatic than at any time since railroads created the first pension program in the 19th century. A significant amount of the statistics presented here come from P&I’s annual plan sponsor survey. We have electronic records to the early 1990s, but dusted off print archives to show information to the mid-1980s.

FIxed income allocations of corporate and public pension funds

This slide lays out year by year the allocations to fixed income. Starting in 2008, you can see a dramatic change to fixed income by corporations. Numerous corporate plan sponsors now have allocations to fixed income of more than 75%. Intel’s DB plan, for example, has an 85% allocation to fixed income.
The trend is pretty constant for public plans: down.