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5th Consecutive Year of Excess Gains

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5th consecutive year of excess gains

Recovering from asset losses suffered in 2001 and 2002, pension funds have experienced investment gains in excess of the assumed rates used for pension cost calculations during each of the past 5 years. For S&P 500 companies for fiscal years 2003 through 2007, this chart shows the median expected rate of return on pension plan assets (purple with squares) as compared with the aggregate actual rate of return on pension plan assets (blue with diamonds).

Of course, weak markets at the close of last year were a major factor behind the fact that 2007 saw the lowest rate of actual asset return of these five years. Since that yearend weakness has continued into the first three months of 2008, pension plans have an uphill climb to try to make 2008 the sixth straight year of excess returns.

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Written by macheide

17 March 2008 at 3:17 pm

Posted in άctuary

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