Chapter

Establishing Pension Investment Policy

August Baker, Dennis E. Logue and Jack S. Rader

in Managing Pension and Retirement Plans

Published in print November 2004 | ISBN: 9780195165906
Published online July 2005 | e-ISBN: 9780199835508 | DOI: http://dx.doi.org/10.1093/019516590X.003.0006
 Establishing Pension Investment Policy

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This chapter discusses the key elements of investment policy as they relate to asset pools of pension plans and the goals of funding pension liabilities in a cost-efficient manner for defined benefit plans, and of accumulation of wealth and providing retirement income for defined contribution plans. Pension investment policies should be put in writing to serve as guidelines for prudent decision-making. The most important policy that must be determined is the plan’s (or portfolio’s) tolerance for risk.

Keywords: pension funds; pension plans; pension investment policy; diversification; investment management; risk

Chapter.  4760 words. 

Subjects: Financial Markets

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