Investment performance of US and European pension funds. A comparative analysis

Pension funds are growing rapidly in importance in developed countries as their retiring demographic population is growing faster than the contributing work force. Therefore, essential transformations of the pension systems are being introduced in many OECD countries to make pension systems more financially sustainable. The main ideas behind the changes to retirement systems consist of raising the retirement age and introducing funded rather than Pay-As-You-Go systems. The growth of the pension fund market has been more pronounced in the US and the UK than in other countries. Emerging markets in post-communist economies are also growing in importance both as a destination for pension funds investment and as a growing market in terms of their own domestic investors. The aim of this research is to compare the performance of pension funds in the US with those in selected European countries for the period 2002-2013, since both US and European pension funds are operating in sophisticated financial markets.