This paper examines the allocation of market risk in a general class of collective pension arrangements: Collective Defined Contribution (CDC) schemes. In a CDC scheme participants collectively share funding risk through benefit level adjustments. There is a concern that, if not well designed,...

The recent global financial crisis reconfirms the importance of risk management in defined benefit pension systems. To enhance sustainability, new forms of integrating the risk profiles of assets and liabilities should be considered. Specifically, by reducing the risk profile of assets, by...