By Geoffrey Rubin, PhD, Senior Managing Director, One Fund Strategist at CPP Investments
When people talk about the total portfolio approach (TPA), they may have a perception of its complexity. Analytics matter, but I’ve learned over decades at CPP Investments that the real foundation is simpler, yet more difficult to achieve. It’s about governance, how you look through to your underlying assets, and how you build a team and toolkit that can adapt as your mandate grows.
Governance No Matter the Size
The most critical ingredient of a TPA is clear governance. Management needs full accountability for designing and delivering the portfolio. That means no preset asset allocation handed down from above, just a clear risk appetite defined by governance and the freedom for the investment team to build a portfolio that meets it.
The beauty is this isn’t just for huge institutions. Any fund, small or large, has the power to transform its governance structure. Traditional strategic asset allocation (SAA) frameworks persist partly because they’re simple and easy to govern. However, that same simplicity can also limit performance. Moving to TPA requires boards willing to give management real discretion and to hold them accountable for results.
Think Economic Exposures, Not Labels
Once you have the mandate, the next step is how you look at the portfolio. For us, it was important to stop thinking in terms of asset classes: “real estate,” “infrastructure,” “public equity,” and “private equity” create artificial constraints that may ignore important underlying return drivers.
Instead, focus on the underlying economic exposures: Which assets thrive in high growth? Which protect when rates rise or inflation surprises? This can be a highly technical process or a simple one, but what’s important is the framing.
It’s not about building the perfect factor model on day one. Rather, it’s about sparking the right conversations. Suddenly, an infrastructure investment with contracted cash flows looks very different from one relying on market pricing. Real estate tied to long-term credit tenants behaves differently from a speculative data center build. When your internal teams start seeing those distinctions, you’re on your way.
Build the Ability to Act
Insight is useless without the means to act on it. TPA requires flexibility and the ability to shift from overexposed areas to underexposed ones as conditions change.
We’ve spent years developing internal systems and relationships that let us maneuver the portfolio. That doesn’t mean every fund must go fully internal and many use external managers and still preserve flexibility. But this only happens if mandates allow adjustments and aren’t rigidly tied to asset-class silos. .
Team Size: From Four People to Four Hundred
A common misconception is that TPA requires a massive army of quants. It doesn’t, but it does require thoughtful capability building.
Our journey benefited from setting ourselves up for scale. We knew the fund could grow from $100 billion toward $500 billion and beyond, so we invested early in people and infrastructure. Over time, the team responsible for managing the Total Portfolio Approach has grown into the many dozens, with deep quantitative expertise - within an organization of over 2,000 people. Their focus has remained clear: making investment decisions, not building models for their own sake.
We’ve stayed disciplined about linking analytics directly to action. Understanding whether private equity behaves like levered public equities or more like mid-cap equities isn’t just an academic exercise anymore, it has real portfolio implications. That practicality keeps the team from drifting into theory for theory’s sake.
Data and Systems: Built for Investment, Not Just Accounting
One of the trickier parts of TPA is getting a single view of risk across diverse holdings. Accounting books of record rarely give you the investment lens you need. We had to integrate information across real estate, credit, private equity, and public markets to truly see the whole fund.
We’ve tried multiple approaches, customizing commercial risk models, exploring new private asset data tools, and building our own internal capabilities. Ultimately, we developed an internally tailored risk model for our global, multi-asset portfolio. We still benchmark it against third-party models, but owning the core engine enables us to adapt more quickly.
Experiment Your Way In
For organizations curious about TPA but unsure where to start, don’t try to overhaul everything at once. Experimentation is a key to success along the journey.
Begin by reviewing your current asset buckets and reclassifying them according to their economic exposures. Ask yourself: are all infrastructure deals really the same? Are all real estate investments interchangeable? Even without acting on it yet, those conversations build understanding.
Commit to TPA Over and Over Again
At CPP Investments, TPA is a conscious choice, not an identity we inherited. We believe it better delivers on our singular objective: to maximize returns at a chosen risk level. That belief gave us the confidence to build talent, systems, and scale into the investment department over decades.
The result is a $700+ billion global portfolio we can analyze, understand, and rebalance as one whole organism. It’s also still evolving. Markets change, data improves, and new risk frameworks emerge. But the foundation: governance clarity, factor-based views, and flexibility, endures.
TPA isn’t just a portfolio management tool, it’s a mindset. It’s about treating the portfolio as a living whole and giving your team the mandate and tools to shape it. That shift can happen in a 4-person shop or a 400-person global investor. What matters most is starting with clarity and moving deliberately.
Interested in learning more about the journey from SAA to TPA? Read From Vision to Execution: How Investors Are Operationalizing the Total Portfolio Approach and check out our Total Portfolio Approach Hub.
About the Contributors
Geoffrey Rubin, PhD, is Senior Managing Director and One Fund Strategist at CPP Investments. He heads CPPIB’s One Fund Strategy Group (OFSG), which reports to the CEO and helps optimize strategy throughout the organization by identifying priorities for the Fund. The OFSG works with leaders across the firm to prioritize and develop specific investment and operational strategies while helping build a unified team culture to invest as One Fund. He holds a BA in Economics from the University of Virginia, and a PhD in Economics from Princeton University.
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