SimCorp has released a paper from the Healthcare of Ontario Pension Plan (HOOPP) titled, “Derivatives Processing: How HOOPP Used a State-of-the-Art IT System to Fast-Track Investment Strategy.” Published in the Journal of Applied IT and Investment Management, the paper delves into HOOPP’s liability-driven investment strategy that yielded an unprecedented investment return of 17.1% in 2012 and a record AuM level of $C47.4 billion against $C40.3 billion at the end of 2011.
As HOOPP President and CEO Jim Keohane describes his strategy and model, he attributes much of HOOPP”s record breaking performance to the decision to onboard a new state-of-the-art investment management solution. Keohane cites the right investment strategy and the right investment management system acting in tandem as one of the key reasons that HOOPP has achieved continued success when other pension plans have failed.
“In order to meet our business objectives, HOOPP needed to implement a sophisticated technology infrastructure like SimCorp Dimension to support the portfolio structure that we wanted to employ. The alternative portfolio structure which we have moved to at HOOPP makes extensive use of derivatives and our legacy systems simply could not support the new direction we were taking in our investment approach. SimCorp Dimension has provided the technical support which has allowed us to meet our business goals,” states Keohane.
The advantages that HOOPP has gained though selecting a state-of-the-art investment management system include:
An Investment Book of Record (IBOR) that serves as the single, integrated system of choice to realize investment strategy
The ability to support the investment team with a fully integrated, front-to-back office architecture with robust capabilities including derivatives processing, management and accounting
More sophisticated modelling and risk management processes that deliver daily reports reviewing exposure to credit, liquidity and counterparty credit
Additional flexibility and functionality in accessing a wider range of asset classes than traditional equity and bond portfolios
Faster response time to changing market conditions
David Kubersky, Managing Director of SimCorp North America, comments: “We find that when there is alignment between IT and business goals, technology can transform an investment management enterprise. HOOPP’s tremendous success is a powerful testament to the benefits that a state-of-the-art solution coupled with a strong investment strategy – the liability-driven investment model – can deliver to an organization. With SimCorp Dimension serving as the pension plan’s IBOR, HOOPP is well-equipped to manage a complex derivatives book, all existing instruments and potential ones to come in the future as well.”
For further details, please download the full paper here.
The Healthcare of Ontario Pension Plan (HOOPP) is the leading pension plan for Ontario's hospital and community-based healthcare sector with over 440 participating healthcare organizations and 274,000+ plan members and retirees. On their behalf, HOOPP invests the assets of its C$47.4 billion fund, administers the plan and enjoys a fully funded status. Created in 1960 and now one of the largest and most respected pension plans in Canada, the HOOPP defined benefit plan provides eligible members with a retirement income based on a formula that takes into account a member's earnings history and length of service in the plan. HOOPP's assets are actively managed using a diversified, long-term investment strategy. Governing HOOPP is a board of trustees with representation from the Ontario Hospital Association (OHA) and four unions. A recent study by the Boston Consulting Group listed HOOPP as one of Canada’s Top 10 pension funds. The unique governance model provides representation from both management and workers in support of the plan’s long-term interests. More information at www.hoopp.com.
Since 1971, SimCorp has been providing investment and portfolio management solutions and services to the world’s leading investment managers, asset managers, fund managers, fund administrators, pension funds, insurance funds and wealth managers. SimCorp’s world-class software provides global financial organisations with the tools they need to mitigate risk, reduce cost and enable growth. SimCorp is a global company, regionally covering all of Europe, North America and Asia Pacific. Listed on the NASDAQ OMX Copenhagen, SimCorp is dedicated to supporting the global investment management industry, its clients and its investors. For more information about SimCorp’s products, please visit www.simcorp.com/product.
Enquiries regarding this announcement should be addressed to:
SimCorp North America
Media Contacts (for SimCorp):
Kevin Maher/Angela Byrne
Media Contact (HOOPP):