The recent financial turmoil has resulted in most of the wealth residing in the form of cash. An extensive research on the various types of funds, the amount of money which goes into each of them and their asset allocation will help us in understanding the fund management business in a broad...

We examine the presence of short-termism in the asset allocation decisions of U.S. private defined benefit pension plans. We document an inverse U-shaped relationship between a plan's allocation to fixed income securities and its funding ratio, centered on a 80% funding ratio, and show that the...

This study investigates the relationship between governance, investment performance and asset allocation of pension funds in Switzerland. Our sample includes survey data from 139 Swiss occupational pension plans for which we develop a governance metric comprising attributes of organisational...

Collectively organized pension plans must increasingly demonstrate that the risk preferences of their members are adequately reflected in the plans' asset allocations. However, whether funds should elicit individual members' risk preferences to achieve this goal, or whether they can rely on...

Default features in defined-contribution plans are designed to improve the retirement security of plan participants. To date, these have focused on the challenge of saving, ignoring the more complex challenge of dissaving. Automatic default provisions for drawing down participant account...

We study how pension fund (out)performance is influenced by a) a pension fund's activity, i.e., how much the pension fund deviates in its stock allocation from the typical pension fund behavior, and b) whether the pension fund exploits short- or long-term mispricing opportunities (measured by...

We study whether pension fund board governance relates to asset allocation and show that well-governed boards have greater international diversification and lower cash holdings. In particular, boards that establish comprehensive investment policies invest more in risky assets, in foreign assets...

In this paper we analyze the impact hedging longevity risk can have on a pension fund's funding ratio volatility and ALM strategy. Our model captures all relevant aspects of the ALM problem and is calibrated to industry statistics; however, we've sacrificed model complexity to make the solution...

In recent years, adverse market conditions demolished the funding status of many defined benefit (DB) pension plans highlighting the need for better risk management. We propose a novel framework to decompose the risk of DB pension plans which differs from earlier work in two fundamental ways....

The unique regulation of U.S. public pension funds links their liability discount rate to the expected return on assets, which gives them incentives to invest more in risky assets in order to report a better funding status. Comparing public and private pension funds in the United States, Canada,...