Todd Investment Advisors has launched an asset/liability matching strategy. It invests in bonds to match short-dated liabilities--from five to 15 years in duration--and then uses exchange-traded funds to match longer-dated liabilities. Todd does not manage fixed-income so it has partnered with three structured fixed-income managers, said Matthew Saltzman, director of marketing. He declined to name the managers, but said one specializes in Treasuries, another in corporate bonds and the third in synthetic strategies, for instance using derivatives and collateralized debt obligations. Todd is in discussions with additional managers to give clients more choice.

Todd will use a range of ETFs, from domestic small-cap equities to riskier sectors such as commodities, and will work with several providers, such as Barclays iShares and Vanguard VIPERs. "Since asset allocation is 85-95% of your return, why take the extra risk with active management in a frozen defined benefit plan?" Saltzman said. Fees will be 35-70 basis points.