CFAI Text, V2, P365. The statements under 2.1.3 Liquidity Requirement : … For example, a pension fund paying $100M/month in benefits on an asset base of $15B… the asset base would need to grow to 16.2B in order to meet the payout requirement without eroding the capital base. Why an annual liquidity of 8% of plan assets is required ? Is it 0.67% (100M/15B) ? Why the asset base would need grow to 16.2B ? Anyone can help ?
100 * 12M/15 B = 8% – since the 100 M is per month.
cpk123 Wrote: ------------------------------------------------------- > 100 * 12M/15 B = 8% – since the 100 M is per > month. Sorry for my stupid questions and thanks for your advice.