SVIA’s Quarterly Characteristics Survey demonstrates the virtues of stable value: consistent positive returns, principal preservation as well as having the lowest correlation to stocks as compared to other investments, which means stable value can act as a diversifier. For the third quarter of 2012, stable value fund assets included in the survey were $445 billion, with an average crediting rate (return) of 2.64 percent, which compares favorably with 0.08 percent annualized return for iMoney.Net Money Market Funds.
The survey covers 16 quarters through the third quarter of 2012 and covers 23 stable value managers who now collectively manage $445 billion in assets. Assets have risen by 28 percent since the beginning of the financial crisis and the start of the survey, which began in the last quarter of 2008. Predictably, allocations made to stable value have held steady as the U.S. financial market has worked its way toward recovery. Comparing third quarter 2012 assets under management to previous years demonstrates this trend. Assets grew respectively by: 5.18 percent as of fourth quarter 2009, 0.41 percent as of fourth quarter 2010, and 1.24 percent as of fourth quarter 2011. The steadiness of assets under management from 2008 to date demonstrates a strategic allocation/response made by plan participants at the beginning of the crisis to blunt volatility and overall portfolio risk with stable value coupled with the trend towards more conservative investments as baby boomers move closer to retirement.