A penny is a penny, and a basis point is a basis point. Accumulate enough pennies, and eventually you will have dollars. Save enough basis points, and your defined benefit plan might have a slightly more appealing return. Simple?

Perhaps, but that is the thinking behind an evolving strategy for running pension money that depends on a program of baby steps to reach a better-funded goal.

In the past, the first response of companies facing falling returns has been to reallocate assets into investments with better yields–although presumably with more risk. That was what corporations were attempting to do to varying degrees between 2000 and 2002: When confronted with massive funding shortfalls created by the collapse of the U.S. equity markets, they moved money into hedge funds and private equity.

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