June 2020

26Jun

US. DOL Proposal Will Chill ESG Corporate Pension Investing, Advocates Say

Advocates of environmental, social, and governance (ESG) investing have decried the US Department of Labor (DOL)’s newest proposal as poison for sustainable investments in pension plans. Read also 2 Danish pension funds chip into latest European green bond On Tuesday, the DOL proposed a rule that said company defined benefit (DB) retirement plans have a fiduciary duty to beneficiaries, not to social causes advanced through ESG investing that could reduce returns or increase risk. Read also The Mixed...

June 26, 2020
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05Jun

US. Making Sense Of The Supreme Court Ruling On Private-Sector Pensions

A Supreme Court decision this week on employer pensions? Yes, indeed. The ruling itself Earlier this week, the Supreme Court handed down its decision in Thole v. U.S. Bank, a case in which two retirees in the U.S. Bank pension plan contended, as part of a class action, that U.S. Bank had violated its fiduciary duty in mismanaging its pension plan from 2007 to 2010, causing its assets to crash. (See Reason and 401K Specialist for summaries.) The plaintiffs...

June 5, 2020
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05Jun

South Africa. Investors could be hit by uneven stock markets

Investors could be hit by uneven global stock markets. The warning comes as stock markets around the world extend their remarkable rallies despite a continuing global public health emergency, economic downturns and financial upheaval, political uncertainty and widespread social unrest. Wall Street is expected to open higher again on Tuesday – with the benchmark S&P500 less than 10 per cent from its all-time high. In the Asia-Pacific region and across Europe, all major indices made gains. Global...

June 5, 2020
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04Jun

Canada. Alberta public sector pension plan fund falls $3.4B in quarter, pointing to AIMCo losses

An Alberta public sector pension plan says its fund dropped by $3.4 billion — or 6.5 per cent — in the first quarter of the year, calling it an "extremely difficult" period for investors due to COVID-19's impact on financial markets. But the Local Authorities Pension Plan (LAPP), which has 275,000 members, is also pointing to losses at the Alberta Investment Management Corporation (AIMCo), its mandatory investment manager under provincial legislation. LAPP says total asset losses...

June 4, 2020
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December 2019

27Dec

The Pan-European Pension Product Regulation: A Huge Opportunity for the Luxembourg Fund Industry

By Sebastiaan Niels Hooghiemstra Currently, there is a dynamic and ongoing improvement in life expectancies that is not accounted for in pension systems designed to provide financial security in retirement. All over Europe, there are currently employment-based (2nd pillar) pension funds and first pillar pay-as-you-go (PAYG) state pensions systems that are facing huge funding deficits as a result of that. Recently both the EU parliament and the EU Council took their stance on the introduction of an European legal...

December 27, 2019
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23Dec

Japan, European Development Bank Launch Social Bond Initiative

Japan’s $1.48 trillion Government Pension Investment Fund (GPIF) and the Council of Europe Development Bank (CEB) have launched a partnership to promote and develop sustainable capital markets. Their focus will be on social bonds, and the incorporation of ESG assessments in fixed-income investments. “GPIF requires all asset managers to integrate ESG into their investment analysis and decision-making,” Hiro Mizuno, CIO of GPIF, said in a statement. “We regard the purchase of green, social and sustainability bonds as one of...

December 23, 2019
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16Dec

Ethics, ESG, and ERISA: Ethical-Factor Investing of Savings and Retirement Benefit

By Albert Feuer (Law Offices of Albert Feuer) Ethical-factor investing is investment decision-making that takes into account ethical factors. It includes faith-based investing, Environmental, Social or Governance (ESG) investing, and sustainable investing. It is becoming more and more widespread. This has occurred despite a lack of widely accepted definitions, performance metrics, or ethical preferences. There is increasing broad agreement that some ethical factors highlight business risks and opportunities in a predictable fashion, such as the effects of climate change, human...

December 16, 2019
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February 2017

03Feb

Simplifying Choices in Defined Contribution Retirement Plan Design

By Donald Keim & Olivia S. Mitchell In view of the growth and popularity of defined contribution pensions, along with the government’s growing attention to retirement plan costs and investment choices provided, it is important to understand how people select their retirement plan investments. This paper shows how employees in a large firm altered their fund allocations when the employer streamlined its pension fund menu and deleted nearly half of the offered funds. Using administrative data, we examine the changes...

February 3, 2017
Articles, Investing, Labor Market,
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03Feb

Pensions statistics

By OECD This dataset includes pension funds statistics with OECD classifications by type of pension plans and by type of pension funds. All types of plans are included (occupational and personal, mandatory and voluntary). The OECD classification considers both funded and book reserved pension plans that are workplace-based (occupational pension plans) or accessed directly in retail markets (personal pension plans). Both mandatory and voluntary arrangements are included. The data includes plans where benefits are paid by a private sector entity...

February 3, 2017
Investing, Labor Market
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03Feb

Market risk analysis for Mexico´s pension funds: an autoregressive approach

By Marissa Martínez and Francisco Venegas The aim of this paper is to analyze the market risk of two types of investment funds, Basic SIEFORE 1 (SB1) and Basic SIEFORE 2 (SB2). To do this, we propose a performance index that will be used in ARIMA-GARCH models and some of its extensions, with the purpose of examining the dynamic behavior of the returns and their volatility on such investment funds. Moreover, the risk premium of both types of funds is...

February 3, 2017
Investing, Savings,
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