ALO31: What If the Illiquidity Premium Was Never Real? ft. Richard Tomlinson

Richard Tomlinson joins Alan Dunne for a conversation shaped by experience, not theory. As CIO of LPPI, Richard is responsible for £27 billion in pension assets - but what stands out here is the clarity with which he navigates complexity. From the fading utility of labels like “illiquidity premium” and “hedge fund” to the trade-offs between cost, alignment, and control, this episode is about building portfolios that work in the real world - not just in a model. They explore inflation’s structural drivers, the quiet rise of fiscal dominance, and why some of the industry’s most comfortable assumptions no longer hold. It’s not about being contrarian - it’s about being clear-eyed.

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Episode TimeStamps:

02:14 - Introduction to Richard Tomlinson

07:07 - What makes Tomlinson and LPPI stand out from their peers?

11:52 - Who are LPPI's clients?

13:26 - The investment philosophy behind LPPI's work

18:06 - How LPPI's allocators work together

19:05 - Getting the allocation right

21:29 - Are they worried about the decline of equities?

23:37 - Tomlinson perspective on global macro

26:55 - Public vs private markets

29:05 - Their approach to allocating domestically

31:15 - How their allocation is distributed

33:51 - Is there a place for multi strategies at LPPI?

36:01 - Balancing growth strategies with risk

39:13 - How much would they allocate to alternatives?

41:22 - Their framework for thinking about risk

43:59 - How they approach commodities in their strategy

45:39 - How much focus do they put on ESG?

48:15 - The challenges of high fees in the hedge fund space

50:36 - Is it best to keep managers in-house or external?

53:41 - How they create a strong team of managers

55:37 - The right way of evaluating success and performance

58:41 - Advice for others investors

01:00:19 - The structural themes and trends that are likely to continue

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