Liability Funding Strategies

Liability funding strategies

Investment strategy that select assets so that cash flows will equal or exceed the client's obligations.

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Liability Funding Strategies

Any investment strategy in which one seeks to match cash flows from investments to one's debt and other obligations. That is, when selecting securities in a portfolio, an investor following a liability funding strategy seeks to find those most likely to have a return that will allow the investor to make payments on his/her mortgage, student loans, and/or other liabilities. An individual or a business may follow a liability funding strategy.