Exploring Strategic Investment Management with Paul Matson

In this episode, host Nathan Erickson sits down with Paul Matson, the Executive Director of the Arizona State Retirement System, to explore the intricate world of pension fund management. Paul shares his journey from Canada to Arizona, shedding light on the nuances between Canadian and U.S. investment strategies and the pivotal role of governance in achieving organizational success. Listeners will gain an understanding of the Arizona State Retirement System's approach to internal versus external asset management, strategic asset allocation, and the impact of international relations on investment decisions. Paul also discusses the importance of continuous learning and the value of the CFA designation in his career, offering profound insights into managing risk and optimizing investment returns in today's dynamic financial landscape.

Key Discussions in This Episode:

[00:01:44] Paul Matson's early career and influences from working at Alberta Treasury Department

[00:07:43] Transition to ASRS and the shift towards internal asset management

[00:14:53] Comparisons between Canadian and U.S. investment models

[00:32:01] ASRS's governance model and its impact on decision-making

[00:37:33] Advantages of ASRS's diversified investment approach

[00:42:48] Unique aspects of ASRS's investment operations and liquidity management

[00:44:18] Risk mitigation and portfolio construction strategies

[00:51:20] Conceptualizing investment risk and mitigating contribution rate volatility

[00:59:15] Expected rate of return and the use of a building block methodology post-2008

[01:01:32] Discussion on leverage within the portfolio and its tactical use

[01:04:17] ASRS's stance on market efficiency and tactical leveraging opportunities

Links:

Arizona State Retirement System

Paul Matson on LinkedIn

Nathan Erickson on LinkedIn