Heightened public concern over the health of pension plans and U.S. regulators’ concerns over pension accounting, off balance sheet items, and financial reporting transparency has resulted in a series of reforms. Under the new rules, managing a pension plan will become more challenging and require a different approach to managing risk. Liability driven investing (LDI) is an investment approach where asset allocation is designed to service liabilities and risk is measured not only in the context of asset return volatility but also in the context of how assets perform in relation to liabilities. Under an LDI framework, there are numerous implementation approaches but only one underlying principle: to control the variability between asset performance and the performance of liabilities.