October Rout Will Test Pensions’ Wall Street Crash Protection
Large pension funds are snapping up Wall Street protection against a market crash, but it isn’t clear the products will help limit losses in the current pullback.
Worried their portfolios were too risky, public-pension managers in California, Hawaii and Rhode Island have shifted more than $25 billion over two years or so into “crisis-risk offset” strategies, while others are in the process of such moves. Typically, these tactics aim to limit investor losses by buying long-term Treasury bonds, whose price often increases during…
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