Please explain the following point from Chapter 28 page 16 "Clearly the company could avoid any investment matching problem by investing in the same assets as used to determine the benefits" What does it mean ?
Page 17 ..ch 28 Part III solution states that "investment amount equal to the value of the unit related liability in the underlying assets" could you please confirm what does underline assets mean over here
Hi Mahima The benefits may be based on the value of a unit-linked fund. So the assets should be held in the same unit-linked fund. Best wishes Mark
Hi Mahima It's the same idea as your post above. The benefits are based on the unit fund, so their value is based on the assets that underlie that fund. So again we invest in the same unit-linked fund as the benefits are based on. "Underlying assets" is just the technical term for saying we invest in the unit fund. Best wishes Mark
