Not all pension funds should attempt to scale the mountain that is the ‘Canadian Model’...
I’ve got two interesting articles for your weekend:
First, Pav Jordan, Andrea Hopkins and Soyoung Kim have a nice article highlighting the exceptional nature of Canadian pension funds. It’s well worth a read. However, while these funds no doubt represent the ‘Mount Everest’ of pension management – with deep expertise in direct investing in illiquid and alternative assets that can, at times, surpass the expertise even in the private sector -- not all pension funds should attempt to scale Everest. Put simply, the ‘Canadian Model’ is not replicable the world over; funds need remarkably strong governance and buy-in from the powers that be to resource the kinds of operations taking place within the Canadian plans. Nonetheless, it’s remarkable to see what these Canadian funds are capable of.
Second, you may be interested in reading Gary Gorton and Andrew Metrick’s new paper entitled “Getting up to Speed on the Financial Crisis: A One‐Weekend‐Reader’s Guide.” Think of this as a sort of “cliffsnotes” (or if you’re not as old as I am, “sparknotes”) for all the required reading that we in the financial and economic community really should be doing to keep up to speed on the financial crisis and its origins. Here’s the abstract:
Have a nice weekend!