Company Stock and Pension Plan Diversification

Topics:
Stock Options
Tags:
Business Operations,
Portfolio,
Pension Research Council,
Pension Plan,
Investment,
Insurance,
Financial Planning,
Finance,
Diversification,
Corporate Insurance,
...
Source:
Pension Research Council

FREE Registration is required

Overview: This chapter makes two contributions. First, it develops a measure of the diversification level in a DC plan participant's portfolio. This measure computes how much additional risk reduction can be had by reallocating investments among the choices permitted within the DC plan, without changing the expected return of the currently chosen portfolio. Second, the chapter shows that the plan participant can privately avail himself of insurance against the decline in his wealth attributable to his undiversified position within the DC plan. This insurance takes the form of an option contract that gives the recipient the higher of the return to company stock or a diversified (suggestively, index) portfolio over a given future term: the resulting return would be applied to the dollar amount invested in company stock.

(Is this item miscategorized? Does it need more tags? Let us know.)

Format: PDF | Size: 98KB | Date: Oct 2002 | Pages: 30

Top results from Stock Options

White Paper A Process Approach to Protecting Privileged Accounts & Meeting Regulatory Compliance
White Paper The business value of Portal for Telecommunications- Telco ROI Framework
Book Chapters Is Your Enterprise Architected for Tomorrow's Growth?
White Paper Sales Compensation & Performance Management 2009 Survey Results and Analysis
White Paper Disability Code of Good Practice

» View all Stock Options listings

advertisement
advertisement
  • Click Here
  • Click Here
  • Click Here
advertisement

Returning users: Log In Here!

Already registered on BNET, TechRepublic, or ZDNet? Simply log in.

Free Membership: Sign Up Now!

Sign up for a free membership today and get instant and unlimited access to one of the largest databases of white papers, webcasts, and casestudies anywhere. Your FREE membership allows you to:

  • Download an unlimited amount of content, including classic and current white papers, case studies, webcasts and more
  • Track content on your chosen topics of interest
  • Receive targeted email alerts when your favorite content is added
  • Save content for future reading
  • Receive our member newsletter

When you register to access this directory, you become a member of BNET. In addition, you allow us to share your information with companies that produce products or services featured in the library--so that such companies may contact you with information and offers regarding their products and services. This enables us to keep the library a free service. As a directory registrant, you will receive a complimentary subscription to the BNET member newsletter, The BNET Report. You can unsubscribe from this newsletter at any time. By clicking the Sign up button, you indicate that you agree to our Terms and Conditions and have read and understand our Privacy Policy (updated).