We investigate optimal investment and drawdown decisions in retirement, and show that the asset mix and drawdown strategy vary significantly with financial circumstances and preferences. Loss aversion preferences lead to hedging strategies to secure the target consumption through use of...

Defined Contribution superannuation plans require fund members to make several decisions requiring a high level of financial expertise and participation. Most members do not have the expertise to make such decisions. Hence, the onus falls on fund providers to offer default products that make the...

We analyze the ability of different investment strategies to give pre-retirees more certainty about their income in retirement, while allowing them to benefit from taking investment risk. Specifically, we look at the optimal strategies that maximize the expected values of a loss aversion utility...