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Episode 112: Nick Nefouse

I’m just trying to think of a line, though. You want me to do it? Okay.  

Hi, I'm Nick Nefouse, I’m head of the retirement solutions team and head of Lifepath. Today we're going to 
be talking about staying active in your portfolios. Here are three things you need to know, and one you 
don’t.  

Number one.  
We've seen diversification become more challenging really in the last couple of years. Inflation is what's 
causing some of these diversification problems. When you’re seeing higher inflation, or even volatile 
inflation, it tends to impact fixed income markets, and the ability for fixed income markets to diversify. 
Secondly, and related to this, is policy induced volatility. You're seeing more of this decoupling from 
different parts of the world. Take more policy-induced volatility and less diversification from traditional 
diversifiers, like fixed income. Frankly, just need to be more active in how we build our portfolios.  

Number two.  
As a retirement investor we have to think about market risk, we have to think about inflation risk, longevity 
risk, sequencing risk. What's happened in the last couple of years is that “market risk component” has 
become more challenging. We've needed to broaden out into other areas of the world, whether it's 
Europe or Japan. We've also had to look to areas like liquid alternatives, and introduce things like private 
markets and guaranteed income. So, what we’ve had to do is get a little bit more precise in how we 
allocate to different asset building blocks to deliver retirement outcomes.  

Which brings us to…number three. 
There's a concept we use on the team simply called, “Grow, protect, spend.” Starting off we really want to 
maximize growth, as you're nearing retirement we wanna start increasing protection, and then the goal in 
retirement is to maximize your ability to spend. One of the big mistakes that we see people make is they 
say, “I’ll do this later.” Active is not being just a passive bystander in your retirement planning, but it's 
being active in how you think about savings, time horizon, and spending in retirement.  

And finally. 
I'm a lacrosse coach on the weekends. I coach two of my younger sons. Their lacrosse teams. We're 
talking about nine and eleven year olds trying to teach them how to play lacrosse. For the international 
listeners I'm sure you have no idea what lacrosse is. It's basically where Americans run around and hit 
themselves with metal sticks. It is the national sport of Canada, though, so it's worth looking up.  

To get more three plus one and learn everything you need to know and some things you don’t. Make sure 
to follow us on LinkedIn and YouTube. See you next week.