The Floor-Leverage Rule for Retirement.

• Autores: Jason S. Scott, John G. Watson
• Localización: Financial analysts journal, ISSN-e 0015-198X, Vol. 69, Nº. 5, 2013, págs. 45-60
• Idioma: inglés
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• Resumen

  • The floor-leverage rule is a spending and investment strategy designed for retirees who can tolerate investment risk but insist on sustainable spending. The rule calls for purchasing a spending guarantee with 85% of wealth and investing the remaining 15% in equities with 3× leverage. Surprisingly, this leverage is a tool for managing risk. The authors compare the rule with some popular strategies, illustrate it for a variety of retiree preferences, and evaluate its historical performance.