I understand the majority of this SS, however, can somebody explain to me why its important that equity beta remain the same in the event a company increases the pension asset beta by investing in more equities.
What??? They added 4 more Study Sessions. Great.
falktalk Wrote: ------------------------------------------------------- > I understand the majority of this SS, however, can > somebody explain to me why its important that > equity beta remain the same in the event a company > increases the pension asset beta by investing in > more equities. I don’t know. I just remember it 
- sticky
It’s not that it’s important, they’re just trying to make the point that the company’s risk includes pension risk – so if you increase pension risk you’ll also increase company risk, unless you reduce debt.