Case study: Liability-driven investing protects assets and reduces future contributions By Charles Hodge, Jeremy White | 09 April 2012 A well-funded pension plan implemented Milliman’s Segment Matching-Surplus Management (SM2) approach to liability-driven investing (LDI) at the beginning of 2011. Even though equities produced less than expected returns and corporate bond rates reached historic lows, this plan’s funded status remained stable in 2011, precisely as predicted. Issue: After years of volatile annual contributions, the Investment Committee wanted to stabilize contributions and protect their pension plan’s funded status. Due to additional contributions and favorable equity returns in 2009 and 2010, the plan was nearly 100% funded on an ongoing basis at the beginning of 2011. Howev

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