Investment Approach
Our investment portfolio uses a sustainable long-term approach, with assets diversified across a wide variety of classes, risk-return characteristics and degree of liquidity.
A professional investment management team oversees the Plan and is responsible for executing the investment framework set out in the Investment Policy. Our team selects highly qualified investment management firms that have the specific expertise to implement the required strategies and asset mix. The team continually monitors their performance against targets for both returns and risk level. This approach helps ensure the sustainability of the Plan by reducing overall risk and balancing pension security with affordability.
At TTCPP, we have a fiduciary duty to our members to consider all the risks related to the investment of the Plan’s assets. This includes consideration of nonfinancial risks such as environmental, social and governance (ESG) factors. We believe that over the long term, companies with sound corporate governance structures and practices are the companies that will outperform.
Building a diversified portfolio
At TTCPP, we include an array of investments that can be summarized into three broad categories:
Fixed income
Fixed income investments reduce funded status volatility from year to year. They include interest rate–sensitive investments in Canadian government, and provincial and corporate bonds of a variety of maturities (short, medium and long). Fixed-income investments represent 37% of the Plan.
Growth assets
Growth assets are investments that seek a higher return than liability-matching assets, but they are also characterized by higher volatility. Our Growth Asset Portfolio contains Canadian and non-Canadian equities, private equity and absolute return investments. Growth assets represent 49% of the Plan.
Real assets
Real assets are investments that share characteristics of both liability-matching assets and growth assets. They tend to offer higher long-term returns than bonds but generally don’t have the volatility associated with growth assets, and they provide some protection against inflation. Our holdings in real estate and infrastructure are included in this category. Real assets represent 24% of the Plan.
2022 diversified asset mix
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