Open AccessMETHODICAL APPROACH TO FORECASTING THE REAL RETURN ON INVESTMENT IN NON-STATE PENSION FUNDS
Author(s) -
Vlada Zhykharieva,
Марія Паршикова,
Тетяна Хромих
Publication year - 2021
Publication title -
ekonomìka ta suspìlʹstvo
Language(s) - English
Resource type - Journals
ISSN - 2524-0072
DOI - 10.32782/2524-0072/2021-31-1
Subject(s) - rate of return , holding period return , investment performance , economics , return on investment , investment (military) , econometrics , time weighted return , pension , rate of return on a portfolio , maximization , inflation (cosmology) , return of capital , internal rate of return , absolute return , real interest rate , inflation rate , financial economics , finance , interest rate , microeconomics , modern portfolio theory , portfolio , physics , production (economics) , politics , theoretical physics , political science , law
In the article the methodical approach to determining the projected real return on investment related to a private pension funds (PPFs) is proposed. The technique involves variant calculations and allows maximization the real return of investor based on the variation of input parameters. The first stage involves building the model for forecast investments in PPF, taking into account compound interest. At the second stage, the calculation of periodic pension benefits is based on the forecast rate of return. At the third stage, an investor, based on the model, can perform the inverse operation – to determine the return on investment without taking into account inflation, using the money-weighted rate of return, based on NPF’s proposal for payments. At the fourth stage, the real return on investment is calculated taking into account the inflation rate. The criterion for the choice of investment conditions is the maximum real return on investment. The capitalization rate is compared with the risk-free rate.