Don Templin: Yeah, Suneet. So, yes, we’ve been talking about it for a number of quarters now. We will probably continue that as we’ve guided to expectation that the full year would play out in a consistent manner to the first quarter. So, you do the step back and obviously, we’ve been peeling apart as best we can and we can do it well. What is going on, what is the situation for these individuals, you think about different age cohorts, you think about are they separated from service, they’ve left money behind and are there things going on that are driving activity in the — look, the main thing that we’ve talked about historically is also, I still think true, as you look across the industry and who’s talking about getting flows, obviously, annuity providers and the influence that advisors have on those decisions is just apparent.
That’s a piece of the story. People have fixed rate options that they didn’t used to have outside of insurance products and just banking products. I think there’s an element of there was some pent-up demand. And as you get older, obviously, you think a little bit more conservatively about where you want your money and how you want to allocate it. The thing, and Heather and I alluded to this already, I think this is an area where we think there’s opportunity for us to continue to lean in on advice and education to support those decisions better around the retail story. But we’re going to continue to evolve the product set, the solutions we have and the capabilities that we want to own and control versus how we continue to partner and work with not only plan sponsors but also our distribution partners.
As you can imagine, it’s a complex decision point and there are a lot of players involved that we think we can continue to work better with.
Heather Lavallee: And I would just point to within the quarter, just a reminder that when we see higher equity markets, you tend to see elevated participant surrenders just because their account values have grown, and the recurring deposits that come in, just the ongoing contributions just can’t necessarily offset that. So, there certainly was some impact of that in the first quarter on participant surrenders.
Operator: Our next question is from Nick Annitto with Wells Fargo. Please proceed.
Nick Annitto: Hey, thanks. Good morning. On for Elyse. Most of our questions are answered, but just had a follow-up going about stop-loss. I think you guys said that 10% of new sales are coming from kind of that lower market. Is there an overall target for that going forward as a percent of the book or is that just kind of dynamic?
Rob Grubka: No, look, I would just say it’s current state. It’s a state we’ll continue to think about growing and have it be a more meaningful part. But again, back to one of the earlier questions, would I then think about that bringing in business at a different margin expectation, I would not. So, I think from — as you think about modeling, it isn’t a variable that at this stage, you need to be concerned about or worried about changing the dynamic within stop-loss. But that’s the current state.
Nick Annitto: Thanks. That’s helpful. And I guess just as a follow-up. On alts, is there any sensor expectation for 2Q? It seems like you guys held up a little bit better than some peers this quarter.
Matt Toms: Yeah, Nick, this is Matt. I’ll take that. Close to the long-term average in the first quarter, we restated confidence in the 9% range for the year. We did provide in the materials this quarter additional information around the makeup of our alternatives portfolio. You referenced that we’ve held up a bit better than what is a — I’d say higher dispersion within the industry, we view is correct and we think driven by the quality of the portfolio, you’ll see it in the materials, the heavy skew towards private equity. And within that, while diverse, a reasonably a low number on commercial real estate at 3% of that’s alts book. We think that’s different than our peers. It’s provided returns above that 9% number historically, close to that in Q1.
And the forward look is encouraging to us. Always hard to know exactly where valuations will come in. But as we look into the second quarter, we think there’s a bit of a tailwind. But we’re comfortable at 9% for the entire year.
Operator: [Operator Instructions] Our next question is from Kenneth Lee with RBC Capital Markets. Please proceed.
Kenneth Lee: Hey, good morning. Thanks for taking my question. Just one on Investment Management. Revenue yields, they were picking up pretty nicely last couple of quarters last year, slight decline this quarter. Wondering whether there was anything to call out in particular or whether it was just due to mix shift. Thanks.
Rob Grubka: Yeah, thanks, Ken. Let me provide some detail on that. It is really, as you point out, a mix-shift. We’ve seen our revenue yield as a counter-industry trend. It’s been increasing as you referred to over recent quarters. We’re projecting more stability as we look in the year forward. There’s always different flows at different time. And if we think about retail has helped us support that over the last number of quarters. We think about the institutional and insurance channels growing. You can have some influence that will move that around. We do not view this as an inflection point or a change in the moving forward. And ultimately, that revenue yield is driving the margin improvement as we mentioned. So, both on the top-line and on the expense basis, happy how that’s playing through to the overall business.
