Title: Personal pension plans and stockmarket volatility
Description: Personal pension plans transfer investment risk to participating workers and expose them to the volatility of financial returns. Simple financial strategies lower the volatility of replacement rates but at a significant cost in terms of lower replacement rates. The purchase of valuable annuities reduces the dispersion of replacement rates across generations without lowering their level.
Subjects: Annuities, Investments, Pension trusts, Prices, Rate of return, Risk, Stocks