Defining and Managing Pension Fund Risk

Corporate executives have traditionally defined pension fund risk in terms of a trade-off between risk and return on the assets built up against their fund obligations. Butassets do not exist in a vacuum, seeking return and avoiding risk for their own sake. When this may seem obvious when expressed inso many words, for U.S. investors it has taken the arrival of the Financial Accounting Standards Board ruling 87 to bring the variability of pension fund liabilities to front and center.