Product Design Of "Retirement Target Date 2035 Fund"

With the further aging of population as well as the growing demand of pension insurance system,the problem of sustainable development of old-age security system has been attained more and more importance.The growing pension market sprouting from 2014 as well as The Guide for Pension Target Securities Investment Funds promulgated in 2018 have provided political guidance and regulation for residents to invest securities by personal pension account,further promoted the development of the third pillar of pension in our country,which would benefit not only the maintenance and appreciation of assets value but also the long-term stability of the capital markets.However,China’s pension target date fund is still in the early stage of development,many products are still in the process of research and development,and there are still many problems in application.Based on the theory of human capital,this paper combines the modern investment portfolio theory and risk parity model in the asset allocation strategy,and attempts to design fund investment products for the retired people whose retirement date is around the year of 2035.The “Retirement Target Date 2035 Fund” product refers to the characteristics of typical fund products.In the stock fund,the index fund is selected as the target fund,and the internal allocation strategy is adopted to invest in the equity,bond and currency funds of Company A.According to the historical net value distribution of different types of funds,Monte Carlo simulation is used to set different volatility and random functions,thus depicting the changes of future fund net value.On the assumption of parameters,the ratio of stocks and bonds in the market is calculated to be 35:65 through the data and trends of residents’ income and consumption,and the linear relationship between human capital and financial assets is determined.In the process of asset allocation,the parameters of China’s investor risk appetite are added,so that the investment strategy is more in line with the needs of investors.Through the analysis of the risk and return of the fund products,it is found that the constructed products have an average annual rate of return of 6.30% at an acceptable risk level,and can achieve a total return of 311% by 2035.The performance is better than bank time deposits and Performance benchmarks.At the same time,the product is suitablefor different types of investors.If the investor’s own risk tolerance is strong,after the more equity assets are allocated to it,the yield will be higher when it expires.In addition,this paper describes the risks of fund products,and believes that it is necessary to continuously track and evaluate the underlying funds,and there will be certain risks in terms of investment strategies and fund holding periods.Through the design of the product,it hopes to provide thinking and reference for the development of such products in the market.