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2014 Pension Asset Return

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FR PBO 2014 all fy+1 (275)Investment returns for assets of defined benefit pension plans sponsored by public U.S. corporations generally remained at the healthy levels experienced for 2012 and 2013. This chart shows the aggregate global investment returns during fiscal years ending in 2000 through 2014 for the assets of pension plans maintained by 275 companies (including companies with calendar fiscal years as well as non-calendar fiscal years; and with a fiscal year shift of 1 month, i.e., results for companies with fiscal years ending in January are shifted back to the preceding calendar year). The solid horizontal line in the chart represents zero: years during which investment returns slipped below that line represent years when assets lost value.

Future posts will estimate the annual rates of return based on these investment results, together with estimated cumulative rates of return over multiple years, then will compare those rates of return with investment return assumptions used to determine pension plan costs.

Remember my usual general cautionary note (something that keep getting forgotten or shoved to very tiny print in footnotes in most of the industry reports on this sort of info), that these numbers include pension assets of foreign pension plans maintained by some of these employers. Which I’ll sort out in future revisions to this post.

I’ll be updating this post as further 10-k reports for 2015 fiscal year are collected (as well as incorporating data previously collected for 2014 and earlier). Earlier versions of the post are retained in backpages, as linked in the numbers at the bottom of this post, with oldest versions carrying the higher numbered links. But as I’ve previously indicated, the trends for any large group of companies — for instance, pension plan sponsors among the S&P 1500, which is a sample size I’ll have collected before leaving this year’s data set behind — will be very much like the chart shown for these 275 companies.

(As I’ve previously disclaimed, posts such as this represent efforts of my favorite pastime. My formal work does not involve any of this, and none of it represents any position or comment that should in any way be attributed to my employer. Likewise, as always, it represents general personal impressions and should not be treated or used as formal professional advice.)

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Written by macheide

11 February 2015 at 9:42 pm

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