A Study On The Portfolio Of China's Occupational Pension Fund

Because the occupational pension fund is an important supplement to China's basic pension plan, the demand for keeping and increasing occupational pension fund's value is higher and higher. On the one hand, the occupational pension fund is the future retirement pension for the employees and it's impossible to use the occupational pension fund to make an investment involving a high degree of risk. On the other hand, the occupational pension fund must add value so as to keep the benefits of the occupational pension plan's beneficiaries and enlarge the attraction of the occupational pension plan. Thereby, it's necessary to make a study on the portfolio of occupational pension fund because it can figure out the contradiction problem between risk and profit of the occupational pension fund investment.On the basis of reviewing the available literature, this paper firstly makes a deep analysis of the major influencing factors for the occupational pension fund portfolio. These factors which influence the portfolio of China's occupational pension fund are diversified and complicated. It's easier to make a qualitative analysis of such influence, but it's more difficult to make a quantitative study. Hence, this paper use the analytic hierarchy process (AHP) to turn related qualitative analysis into quantitative analysis. Then, a method of choosing the better occupational pension fund portfolio is gained on the basis of AHP. In order to gain higher profits for the occupational pension fund, it's necessary to make an investment in stocks. At the same time, such investment must involve a high degree of risk. In order to have a unified safety-profit system for the occupational pension fund investment, it's important to make a stock portfolio of occupational pension fund with a suitable profit-risk level. Thereby, this paper also introduces a method of constructing an appropriate occupational pension fund stock portfolio by using the theory of Markowitz mean-variance model. The computation of this method is assisted by some software such as Matlab and Excel. Through the use of these two methods, some constructive ideas concerning choosing and constructing a suitable occupational pension fund portfolio are offered in this paper.