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Cash balance pension plan

Definition:

A cash balance pension plan is a defined-benefit plan that is maintained on an individual account basis. The employer contributes to a participant's account with a set percentage of annual compensation plus interest charges. The company holds all ownership of profits and losses in the portfolio.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Domestic bonds

Bonds issued and traded within the internal market of a country and denominated in the currency of that country.

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