Stable Value

Moving Away From Guaranteed Investment Contracts

Stable value managers are finding better opportunities in cash bonds.

During the 1980s and 1990s, traditional guaranteed investment contracts (GICs) were heavily used in stable value funds and, at times, made up 100% of the assets of several such funds. More recently, however, GICs have not been as widely used. According to Hueler Analytics, they currently make up 4.98% of the assets in the stable value funds that are included in the Hueler Pooled Fund Index as of September 30, 2020. Many funds do not use them at all. Moreover, as the popularity of GICs has declined, so has the number of high‑quality issuers.

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