Article Abstract:
Total corporate retirement assets are shifting from defined benefit assets to defined contribution assets. Should defined contribution assets exceed defined benefit assets, investment decisions will rest more on individual participants rather than on plan sponsors. Education and communication are critical to making employees understand their retirement income investments. Simplicity also facilitates decision-making for the participants. The use of index funds is expected to address these needs. Index funds offer lower costs, diversification, risk reduction, performance and predictability.
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Article Abstract:
A looming liquidity crisis in the real estate mortgage market provides pension funds with an alternative investment opportunity. An estimated 80% of all existing commercial mortgages is predicted to require refinancing within the next five years. Since the traditional lending sources will be unable to meet the demand for new loans, pension fund sponsors can become mortgage lenders. The four major categories of real estate mortgages that pension funds can invest in are described.
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Article Abstract:
The devaluation of core properties in the 1980s recession has caused many pension fund managers to reconsider including real estate assets in portfolios. However, a funds manager with a thorough knowledge of the economic performance of real estate assets would relaize that its addition to any portfolio would be a desirable diversification. Aside from low volatility and risk, industrial grade real estate constitutes only a small percentage of the pension fund portfolio.
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