Retirement savings instruments in the Czech Republic - Risk diversification

Bc. Michal Hlubuček

Master's thesis

Abstract:

This diploma thesis deals with the retirement savings instruments in the Czech Republic. The theoretical part of this work contains illustration and explanation of the Czech retirement system and deals with the current problems of financing the Czech retirement system. The retirement saving instruments are presented and explained. Possible options of risk diversification of the investments are presented and explained in the theoretical part. The practical part of this work is build up on the theory of this problem. The objective of this work is to compare and propose the most appropriate financial products saving for retirement depending on the age of the individual. This work contains several proposals for retirement savings that are based on the model examples that represent possible individuals who want to prepare well financially for their retirement age. This thesis deals with risk diversification based on the investment horizon and explains the importance of diversified portfolio and active portfolio management. The result of this work is a selection of appropriate financial products for the retirement saving and subsequently to confirm or reject the three stated hypotheses.

Abstract:

This diploma thesis deals with the retirement savings instruments in the Czech Republic. The theoretical part of this work contains illustration and explanation of the Czech retirement system and deals with the current problems of financing the Czech retirement system. The retirement saving instruments are presented and explained. Possible options of risk diversification of the investments are presented and explained in the theoretical part. The practical part of this work is build up on the theory of this problem. The objective of this work is to compare and propose the most appropriate financial products saving for retirement depending on the age of the individual. This work contains several proposals for retirement savings that are based on the model examples that represent possible individuals who want to prepare well financially for their retirement age. This thesis deals with risk diversification based on the investment horizon and explains the importance of diversified portfolio and active portfolio management. The result of this work is a selection of appropriate financial products for the retirement saving and subsequently to confirm or reject the three stated hypotheses.

Keywords

Retirement savings, PAYG, investment instruments, additional pension insurance, supplementary pension savings, construction savings, capital life insurance, investment life insurance, mutual fund, stock, bond, risk, return, liquidity, investment horizon, diversification, active portfolio management.

Language used: English

Date on which the thesis was submitted / produced: 12. 4. 2017

Thesis defence

• Date of defence: 1. 6. 2017
• Supervisor: Ing. Petr Mach, Ph.D.
• Reader: Ing. Pavel Babka, MBA

University of Finance and Administration

Master programme / field:
Economics and Management / Business Management and Corporate Finance