Alternative Investments in Voluntary Pension Security
Alternative Investments in Voluntary Pension Security

Author(s): Patrycja Kowalczyk-Rólczyńska, Tomasz Rólczyński
Subject(s): Financial Markets, Socio-Economic Research
Published by: Masarykova univerzita nakladatelství
Keywords: alternative investments; traditional assets; rate of return; risk; pension security;
Summary/Abstract: Voluntary pension security plans play an important role in every pension system. Demographic changes in European countries cause that the value of pension benefits from the mandatory part of the pension system will be getting lower in the following years. This will have a significant effect on quality of life and consumption of retired people. In order not to increase the group of people at risk of poverty, one needs to increase the number of economically active persons who voluntarily save for their retirement. As part of the voluntary forms of pension security different products, mainly financial ones, are offered (often by banks, insurance companies, investment funds and pension funds). The contributions paid are invested mostly on the capital market (both safe and risky financial assets). However, on the market there are also alternative assets which in the long term can generate higher rates of return than investments in traditional assets. People who save money should consider including in the portfolio alternative assets which would affect also the diversification of the portfolio constituting voluntary pension security plans. Among alternative assets a special attention should be paid to real estate, gold, silver, arts, wine and whisky as well. In those types of assets investors can invest both directly and indirectly. The aim of the article is to assess the role which alternative investments play in voluntary pension security on the Polish market. To achieve that purpose, statistical methods, such as for example correlation coefficient, are used to assess the relationship between characteristics of describing alternative and traditional assets.

• Details
• Contents