Public-sector pension plans take on more risk, research finds

01/31/2012 | aiCIO Daily News

Public-sector pension plans take on more risk than private-sector plans for several reasons, according to researchers at the University of Drayton. Fears of a shortfall in underfunded plans are one reason. Another is the government accounting standards that greatly influence risk-taking behavior, because higher return assumptions "are associated with higher equity allocation and beta," according to the researchers' report.

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