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Elizabeth Burton

lines on the record: 85
first: 2023-09-15
most recent: 2023-09-15
sittings or episodes: 1
sources: podcast

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“And then they can manage to that or something like that. And they often have models for modeling their cash flows. On corporate pensions or European pensions, they most likely are involved in either liability-driven investing or this cash flow matching. But I will say of the top 10 questions I get from allocators this year, one of them is, can we implement cash flow matching to try to help our liquidity issues because of the denominator effect right now a lot of pension funds in the US are still suffering from some liquidity issues since they're super overweight private equity and the equity markets had stumbled.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“No, they probably don't unless they're investing in private markets or in your house. You're probably thinking about how to afford those payments. So in the US and Europe or abroad, there are actually two separate things. So in the US, corporate pensions other than public pensions, right? Corporate pensions tend to focus more on the liability driven side, meaning they're matching their cash flows very carefully. On the public side, usually it's not an LDI type format. They are monitoring their liquidity, so they might have a coverage ratio. So they might say, how many times can we meet our pension payments and private market private equity capital commitment pacing over a certain ratio with no contributions over a certain number of our viewers? So maybe they say, okay, we want it to be quarters. We want it to be 20 times.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“So it's a very precarious position. Luckily, it actually, as you probably know, the market turned around rather sharply. There was a good equity rebound. A lot of this didn't end up happening. In fact, state revenues were often at all-time highs from taxes. When this happened. So the worst was somewhat avoided in the US, I will say. But it did shed a light on the fact that you still can have equities and bonds dry down at the same time. You can have a challenging liquidity environment just like we had 08, which I don't think they're not the same thing, but similar challenges in some respects.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Those would slow contributions into the system, but it depends on how you calculate the multiplier going out. So if it's based on their highest wage ever, It could be that your contributions actually stay constant while the incoming cash flows are not also, and many pension funds, while there are technically penalties for employers not contributing to the system, it's very politically unpopular for a pension fund to go after its counties or teachers or police for payments, right? So it's very unlikely that would happen.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“So we actually never fully shut down. We were always in operations. I was in the office pretty much full time. But one thing I want to point out is that not all employees at all pension funds contribute. Some don't. There are certain types of employer sponsor plans where some portion of the employees are potentially all are part of non-contributory plans Other multipliers are different and their payouts are different, but that's a tough situation when you're not paying in and you're only receiving, right? But what you did mention, so in COVID, a bunch of pension funds experienced or thought they were going to experience furloughs or cuts in their work week, which are essentially cuts in wages, right? So 50% furloughed, you're also 50% wage cut.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it would be tough to outsource all of it unless also the investment team was partially outsourced. I think there needs to be some. Marriage between the two, but I do think that you can outsource certain functions of it, or you can have a consultant assist with the risk management. But I think the most important thing that you have to do at a pension fund for that is get a hold on, you have to have good lawyers and good contracts. You have to have a clear view of your liquidity and your cash flows. It's critical”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Risk management is tough at a public pension, and Goldman Sachs prides itself on being a good manager of risk. But Goldman Sachs has fewer constraints. We actually have a budget for risk management and technology and tools. That is not something your typical pension is able to do. And it's a critical need, and they often have to Find multiple tools that they can use, some free, some not free to try to make a good and robust risk management system. But it's definitely a challenge and it's really important because to your point, especially now, it's always been important, but I think post-COVID, the industry is starting to realize that liquidity for pension funds is extremely important. It affects almost everything they do. And the lack of it could have really dire outcomes. And have a host of other consequences”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“It's funny you say that Hong Kong is my second favorite city in the world. New York is number one. No, it took all 30 seconds. In fact, I very much wanted to live in Manhattan. I wanted to go back to the West Village where I lived in my 20s. But my husband was like, well, with two kids and a dog and a cat, maybe we should. Not do that. But no, I actually have pretty long commute. I love coming into the city every day. I don't think for me personally, there's no better city in the world. I love”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“And I was realizing I was sacrificing my family to live in this beautiful location. I also really missed being in New York. It's an island too. And that's an island, right? And I missed being around the buzz of finance. It's very easy in Hawaii to get wrapped up in the water and surfing in the mountains and the hiking. All of that is lovely, but I run it about 160 miles an hour and I like to be at a place where people run at least at that. And I have to say Goldman Sachs definitely runs at 160 miles an hour. I wanted to go back to finance and being more like in the middle of all the frenzy.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think COVID sped up the process a little bit. I also don't know if you've ever experienced this. There's like one day when your parents are really young and then within 30 minutes they all sudden age. Right. And you miss them and you've got to take care of them. And so my parents, if they listen to this, are going to kill me for calling them old. But, you know, I had little kids. When I moved there, my daughter was two, my son was four. And I think they saw them two, three times.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I think, you know, he's a really good guy. I basically said I've been working my whole life for something like this. I was 34. I was a female. It was, you know, a Hawaii pension. There's only so many pensions to take pensions in the US. I said, who knows what the next one to crop up will be. This is unique. There aren't that many young or female CIOs. Like, I have got to try this. And I think he could tell how badly I wanted it. And he sweetly gave up his job of 15 years and followed me out there.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“On vacation, I went to work in Asia. I was gone for a couple months here and there. When I got back, they said, okay, that's so unlikely, but you're down to about 40. I was like, oh, I like those odds. Those are okay. And then by June, I was telling my husband, I'm in the final four. We gotta fly out there. And he said, I'm absolutely not moving to Hawaii. He had a, he had a great job. He's very senior in his career. Both our families are on the East Coast. Went out there for about a week, and at the end of the week I interviewed and got the job, and we accepted by the end of the week.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“It is interesting how it happened. I guess I got lucky. In January or February of 2018, Hawaii parted ways with their then chief investment officer, and there was an article in a magazine for institutional allocators about it and how they were hiring. And I still have the email I sent to my husband and I said, ha ha, want to move to Hawaii? And I forwarded it to him. I was very happy at Maryland, wasn't planning on leaving. And I had a lot of ties to Maryland that I didn't think I wanted to break. But on a whim, I applied and at the same time had mentioned to a friend of mine that I had applied. And it turns out the recruiter had called my friend about the job. And he said, I'm not interested, but I know someone who applied, and she's got a wrist background, and I know you at Hawaii care about risk. And so he put me in contact with a recruiter. They reached out and they said, look, you're one of 140. Unlikely. So I actually went.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“That's one of the things I love about Goldman, and I also loved about Maryland is like good people, and you're constantly learning and it never is boring.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“It is amazing. I sometimes wonder if I would have rather having started with this experience and then got what I would have been better at Maryland having known what I know now, or am I better now, having learned how things work on the client side? So I go back and forth, but I'm lucky to have had both. And at Maryland, it was a giant pool of capital, $55 billion back then. I'm not sure exactly what it is now. You could talk to pretty much whoever you wanted to talk to if you had a question. If you had a question on high yield, it's not inconceivable one day you might get to talk to Milken about it. And that is just so cool. And I learned a lot because remember, I majored in French and politics. I did go to Chicago, but they teach, you know, more finance, less about like these esoteric strategies.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I think number one, the team. My team at Goman and the broader team even, and the team at Maryland are some of my favorite people. Really wonderful, smart, fun human beings to work with a very clear mission. I also really like the access talking to really smart people. Goldman, it's the internal access, talking to the traders and the PMs and the CIOs. And we have so many offices across the world that are willing to have a unique vision.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“So, at Maryland's first, I had two brief jobs between the fund of funds in Maryland and business school in between there. Maryland was first, and I never intended to leave Maryland. It was one of my favorite jobs. My current job is probably my favorite job, but that is a very close second. Good safe.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“22 hours with a layover in Dakar. And I remember before the airline rules, I got stuck on the tarmac once for five hours. Wow.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Zurich, Johannesburg, and Cape Town, the majority of the trips, and we tried to go a couple times a year to each of the different offices. They would come here as well. But at that point, I was still fairly young and it wasn't as much client fixing XUS, not as much explaining and because I was on the diligence team. So more research based.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Something happened. So I wanted to try other strategies and multi strat sounded like a good place to learn about a bunch of different types of strategies. I was really interested in hedge funds. Our clientele was mostly XUS, almost exclusively XUS. And it was great. The best part about that job, actually, wasn't even the investing and the meeting funds. It was actually that I worked on a team across multiple continents and like just trying to stay in touch and trying to work together on this portfolio and coordinate meetings. And we all had different backgrounds and different investment ideas and different clients. Like US clients are very different from clients in other countries. So it was a really unique experience. I still keep in touch with them. I eventually moved over to the Global Macro CTA type side of the business, a little bit of a diversifier, which is funny because later at Maryland and then in Hawaii was a big part of our investment strategy. It was investing in macro.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I was working, so they had four offices one in Switzerland, one in Johannesburg, one in Cape Town, and one in New York. And so the New York team was the diligence team. And we had a couple products. I had originally started out on the multi-strategy product. I had gone to work there because I'd previously worked in mortgages and mortgage backs. And as you know, that was around 07.08. Tricky time wanted to diversify”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I think sometimes, but you could also take that and apply it to a company, right? You could say that if you have a company that has people working there for 25 years, they all have seen the same thing for 25 years. When you get one person that comes in and has a year of experience in that industry, they're going to bring a new vision to it. And they may be wrong, but there might be parts of that that are really interesting. And I feel that because I was only there for a year when I won that award, there might have been flaws in my argument, but because I hadn't grown up in the public pension space, I had a different perspective on what might work. And that's what I applied.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“They may pass on that. So you may miss out on a good investment. So I always tried to find a way to not miss out on those investments. Plus, often those investments are some of the better investments because a lot of people have these constraints. So there's not as much capital flying in there. And when you have limited capital chasing, you know, these really amazing deals, you can often earn a higher return.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“It could. It could also depend on the bogey or the target return for either if the person managing those two portfolios are different, they may have different objectives. So it may slip through the cracks, even though it's a good. There's also some sort of hedge fund structures that have private equity like investments. If the private equity team doesn't feel that the return is higher enough, they will pass. But if the hedge fund team feels like it has too high of an equity beta.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I believe it can. I believe it can save you from making poor decisions. But outside of your mandate, but here's a good example that's come up in recent years, real estate that has been something in recent years that is something that we're seeing in institutional portfolios. So does that go in real estate or does that go in debt? It can be a tricky problem.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“How ridiculous is that? So it's a problem that institutions often suffer from that retail investors do not, like you and me. We probably don't have this bucketing issue. And so I always felt in institutional management that we were hamstrung by these bucketing issues because we weren't able to invest in things because of these prescribed rules, which I'm not saying are bad, but they can be limiting. Anytime you have a rule, you limit your availability of options.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, let me give you an example. I don't know if you're in the market for a house currently, but let's say your realtor goes and says talks to you and you say, I love Cape Cod's. And he's like, okay, okay. I've also got this amazing condo that overlooks all of Central Park. And it's only $1 million, right? Or it's only $200,000. And you say, wow, $200,000 for a condo overlooking Central Park. That sounds great. But I only have spots in my portfolio for a Cape Cod.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“They were both young. My father had worked with public pensions, and he said, this is a pretty good place to be in finance if you want to raise kids. It's a little bit better of a lifestyle. So I applied to Maryland State Retirement. I actually think I interviewed there a couple days after my child was born because they were cutting off the application and I luckily thankfully got the job, got to work for one of the most amazing CIOs in the business and a close friend, Andy Palmer. But how I got the award, I'm not sure. I think, you know, I was in my mid-30s at the time. And I think I was a little bit outspoken. And I also believe that I have never really believed in bucketing very much in investments. And so I often would look at investments in my portfolio that may be different from what most other people put in their portfolio.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“So that was kind of a meandering path a little bit. What ended up happening was I met my husband right before I went to business school. He was living in Maryland. My boyfriend during business school. And he was living in Maryland. And so after school, I decided I should probably move there, not back to New York, not back to California. And the hedge funds down there looked like post-Madoff, post-GFC, that they were really going to struggle. So I had to switch industry. So I actually went to work in M&A and payments. And I enjoyed that. After three years, I decided I don't love payments enough to continue to do consulting an MA in payments. So I actually went and worked in economics. I was an econometrician. And then when my second child was born, I needed a little bit of a different lifestyle. I had two kids.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it's because I went into risk management straight out of school on the risk side of fund of funds. And various other industries. And without a formal degree in math and statistics, I think there was some hesitation on whether or not it was capable of doing it, which may be fair. And I wanted to bolster my resume a little bit away from politics and French. And so I thought, what better place to go? You know, might hurt a little, but Chicago is a pretty good place to learn some math in.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“At UCO, and my dad lived in the international house. He's from Houston, so I don't know how he pulled that one. Well, it's really like a different kind of humidity makes it feel.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes. I'll show them. Or yours or Chicago. Right. And then the third and final reason was my dad got his PhD in econ from Northwestern, but he's so ancient back then it was taught at the University of Chicago. And so I was.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Inevitable, unavoidable. Well, so I will be this will be the first time I'm telling honestly why I went to booth. Two reasons. One is true, and I've always said, is that I wanted people to stop asking if I could do math and no one asked me if I can do math anymore with a degree from Booth, particularly in econometrics and statistics. But the other reason was Booth rejected me in undergrad.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“Relate to finance. It doesn't, but my parents told me college is the last time you can study on RDIM anything you would like. And so they were both in finance. And I decided that must be the absolute last thing I ever wanted it to do.”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source
“I do have a degree in French. A little bit of a cheat there, unless you consider English majors cheating as well who speak English. But my grandmother is from Normandy. And so I've been speaking French since as long as I can remember. And I love French literature. I actually have some relationship far, far away to Jules Varne. So how does that”
2023-09-15 · Masters in Business · Elizabeth Burton on Liquidity in Pension Funds · IDENTIFIED FROM THE TRANSCRIPT · source