Publication Type
Journal Article
Version
acceptedVersion
Publication Date
5-2010
Abstract
Singapore's mandatory national defined contribution pension system permits participants to invest their retirement savings in a wide range of investment instruments if they wish, rather than leaving their savings in Central Provident Fund (CPF) accounts to earn interest rates by default. This article asks whether workers seeking to earn higher returns can expect to do better than the CPF-managed default, by moving their money into professionally managed unit trusts. We use historical data to investigate whether fund managers possess superior stock picking and market timing skills, as well as whether they exhibit persistence in performance and offer diversification benefits to participants. The evidence is mixed, which could explain why so few participants opt out of the CPF-run default fund.
Keywords
pension, retirement, investment, portfolio, investment choice, return and risk, Singapore
Discipline
Asian Studies | Finance and Financial Management | Portfolio and Security Analysis
Research Areas
Finance
Publication
Pensions: An International Journal
Volume
15
Issue
2
First Page
100
Last Page
110
ISSN
1478-5315
Identifier
10.1057/pm.2009.33
Publisher
Palgrave Macmillan
Citation
KOH, Benedict S.; Mitchell, Olivia S.; and FONG, Joelle H. Y..
Collective investments for pension savings: Lessons from Singapore's central provident fund scheme. (2010). Pensions: An International Journal. 15, (2), 100-110.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/3006
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1057/pm.2009.33
Included in
Asian Studies Commons, Finance and Financial Management Commons, Portfolio and Security Analysis Commons