For that reason, PUBLICA does not aim for the broadest possible selection of countries. Instead, it makes a specific assessment of individual markets, using a range of criteria, such as government debt, the budget deficit, competitiveness, political stability, sustainability aspects, tax issues and, especially, the liquidity of the market concerned.
PUBLICA also pays careful attention to implementation. The investments are closely tied to a benchmark. At the same time, targeted adjustments are made if, for example, they can reduce transaction costs. These include direct acquisitions of bonds when they are issued, the selective use of futures, and a benchmark with a constant duration.
This approach shows what long-term investing means for PUBLICA: understanding an investment’s function in the overall portfolio, selecting in accordance with clear criteria, and implementing meticulously.
Philipp Luginbühl, Senior Portfolio Manager Fixed Income at PUBLICA, explains this approach in his article “Selektiv statt breit” (in German) in Schweizer Personalvorsorge magazine.
