RPIA's LTCB fund promises to help Canadian pension sponsors boost diversification and target outperformance
Canadian pension plans seeking both precision and performance in long-duration fixed income now have a new option.
RPIA, one of Canada’s leading fixed income asset managers, has launched the RP Long Term Corporate Bond Fund (LTCB).
This actively managed, investment grade strategy is designed to help plan sponsors:
- Better align assets with long-term liabilities
- Enhance credit diversification
- Pursue potential outperformance
LTCB addresses a longstanding challenge for pension sponsors.
Traditional long-duration solutions have typically meant choosing between:
- Government or provincial bonds with precise duration matching but low expected returns
- Long corporate bond strategies with modest value-add
- Core-plus solutions that introduce more volatility and benchmark mismatch
These approaches are often concentrated in Canada, limiting diversification and reducing opportunities for active value creation.
The new fund bridges the gap by combining the discipline of liability-aware investing with the broader opportunity set of active credit selection.
LTCB seeks to outperform the FTSE Canada Long Term Corporate Bond Index through active management, while maintaining closer duration matching and better diversification across Canadian and global credit markets.
“With LTCB, we are extending our active credit expertise to a part of the market where Canadian pension plans have had very few options,” said Zachary Barsky, director of Institutional Solutions.
He noted that the strategy “brings together precision and performance,” offering sponsors greater flexibility to align assets with liabilities and the potential for alpha through active management.
Recent improvements in the funded status of Canadian pension plans, driven by higher interest rates, have prompted many sponsors to shift assets into long-duration fixed income to protect surpluses and reduce risk.
LTCB builds on RPIA’s 16-year track record in active public corporate bond strategies, extending this expertise to a dedicated long duration mandate.
Key features of the RP Long Term Corporate Bond Fund:
- Focus: Global investment grade long-term corporate bonds
- Target Return: FTSE Canada Long Term Corporate Bond Index + 80-100 bps (gross of fees)
- FX Risk: Fully hedged back to CAD at all times
- Duration Risk: Closely resembles the Index
The fund offers pension plans a credible way to improve asset-liability alignment, seek disciplined outperformance, and diversify beyond the concentrated Canadian corporate bond market.
