Probabilities – the gift that keeps on giving

When I left the office last night the probability of Trump winning the US presidential election was 15%. We had some very keen people in the office tracking the odds as shown below: In the night the probability of a Trump win dipped to 9% – we all now know what happened next. I am…

Do valuation assumptions matter?

I have read with interest First Actuarial’s article on recasting  the PPF7800 index using, what they believe may be, more “realistic” assumptions for asset returns. For those who haven’t read it the data look promising. The latest PPF7800 numbers quote a funding level, based on mark-to-market assumptions, of 78%(i.e. a Gilts based discount rate). First…