August 16, 2001
Donald M. Raymond, resigned recently as Vice President in Goldman Sachs’ Investment Management Division in New York, to return to Canada to become Vice President – Public Market Investments with the CPP Investment Board. He will take up his new position in Toronto on September 4.
The CPP Investment Board currently invests primarily in publicly traded stock index funds in Canada, the United States and internationally.
“Index investing will remain a cornerstone of our activities,” said John A. MacNaughton, CPP Investment Board President and Chief Executive Officer. “Don’s assignment is to broaden our strategies for investing in public markets. He will be exploring the introduction of quantitative portfolio techniques to index fund management so that we do a little better than the market. He will also consider directing a portion of assets to stock portfolios actively managed by firms with the proven ability to create value above market returns over the long term.”
“My initial priorities are to build a research infrastructure to allocate capital among passive index investing, quantitative portfolio management and active portfolio management, and develop a process for selecting and monitoring external managers,” Mr. Raymond explained. He will recommend a diversification program by early calendar 2002. While active investing can carry increased risk “the record shows that, with the right partners, we can add value above market returns,” he added. “The CPP Investment Board has a 20-year investment horizon before it will be required to return funds to the Canada Pension Plan to pay benefits, so we will have ample time to add measurable wealth to compensate for the risks taken.” Mr. Raymond holds a doctoral degree in electrical and computer engineering from Queen’s University and a CFA charter.
He began his investment career in 1991 as a research analyst in the fixed-income derivatives and liability management department with Burns Fry, a predecessor of BMO Nesbitt Burns. In 1994, he joined Goldman Sachs in their Toronto office as a fixed-income strategist. In 1998, he joined Goldman Sachs’ US$ 16 billion Quantitative Strategies group, based in New York. He was responsible for communicating the group’s asset allocation views to all active global equity, fixed income and currency management teams in the Investment Management division. He was also responsible for several global equity and fixed-income portfolios as well as new product and business development for the group.
The CPP Investment Board’s index fund assets totalled $11 billion on June 30, 2001, or approximately 20% of the total assets available to the Canada Pension Plan, which directly owns a portfolio of fixed-income securities. In June, the CPP Investment Board announced plans to allocate part of its assets to private market investments as a means of diversifying its portfolio and earning long-term values above market returns. The CPP Investment Board is a crown corporation created by an Act of Parliament in December 1997. It invests funds not needed by the Canada Pension Plan to pay current pensions. Cash flows are currently invested only in equities to balance the bond portfolio owned by the Canada Pension Plan. By increasing the long-term value of funds, the CPP Investment Board will help the Plan to keep its pension promise to Canadians. The CPP Investment Board is governed and managed independently of the Canada Pension Plan and at arm’s length from governments.
For further information contact:
John A. MacNaughton
President and Chief Executive Officer
Donald M. Raymond
Vice President – Public Market Investments