Liability-driven investment in longevity risk management

Helena Aro, Teemu Pennanen

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

4 Citations (Scopus)

Abstract

This paper studies optimal investment from the point of view of an investor with longevity-linked liabilities. The relevant optimization problems rarely are analytically tractable, but we are able to show numerically that liability driven investment can significantly outperform common strategies that do not take the liabilities into account. In problems without liabilities the advantage disappears, which suggests that the superiority of the proposed strategies is indeed based on connections between liabilities and asset returns.
Original languageEnglish
Title of host publicationInternational Series in Operations Research & Management Science
Pages121-136
Number of pages16
Volume245
ISBN (Electronic)978-3-319-41613-7
DOIs
Publication statusE-pub ahead of print - 18 Oct 2016

Publication series

NameInternational Series in Operations Research and Management Science
Volume245
ISSN (Electronic)0884-8289

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