Tumanyants K.A., Timofeev Yu.V. International Typology of Public Regulation of Pension Funds Investment

http://dx.doi.org/10.15688/jvolsu3.2014.3.3

Tumanyants Karen Avakovich
Candidate of Economic Sciences, Associate Professor, Department of Economic Theory and Economic Policy,
Volgograd State University
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Prosp. Universitetsky, 100, 400062 Volgograd, Russian Federation

Timofeev Yuriy Valeryevich
Candidate of Economic Sciences, Doctoral Candidate, Frankfurt School of Finance & Management
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Sonnemannstraße 9-11, 60314 Frankfurt am Main Deutschland fs.


Abstract. The research was aimed at determination of factors, affecting the regime of public regulation of pension funds investment. The subject of the research is represented by two aspects of regulation – limits of risky assets and foreign investments. 

The authors used statistical method for comparative study of indicators of 61 countries.
The analysis of regulatory restrictions of correlation between debt (bonds, loans, bills of credit) and equity (stocks, investment funds) of financial instruments in portfolio permitted to highlight 6 groups of countries. As for overseas investments of pension funds, countries can be divided into 4 groups. The study of these groups revealed inverse relation between the level of prosperity in the country (GDP per capita) and rigidity of government regulation.
Direct relationship between national fund market capitalization (in percent to GDP) and the amount of issuers-residents listed on the stock exchange with the maximal limit of investment in equities was revealed. The amount of pension funds (in percents to GDP) and factual unit weight of risky investment (stocks) and overseas investment in pension funds do not have any significant influence on regulatory practice in most countries. The hypothesis saying that the aim of standard establishment is the drive for limiting currency or country risks were not confirmed. Most frequently countries use quantitative restrictions on overseas investment as a barrier against the capital outflow, however, rigidity of restrictions is not connected with condition of current trade balance operations.
Survey results can be used to improve the pension investment regulation in Russia. The use of international experience and international best practices will improve the quality of Russian regulatory framework of pension funds, will increase reliability, profitability, liquidity of pension assets and will increase the transparency of their investment.

Key words: public regulation of investment, pension fund, foreign assets, portfolio limits, stock.

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International Typology of Public Regulation of Pension Funds Investment by Tumanyants K.A., Timofeev Yu.V. is licensed under a Creative Commons Attribution 4.0 International License.

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