Such funds are prepared to get reinvested so as to attain the benefit out from investments. There are different types of institutions that manage and organize investments (Davis, 2001). Such include pension institutions, insurance companies, savings institutions and foundations respectively. All institutions are important with respect to the area of finance they manage and deal with. It is their specialized skill which recovers the benefit from the investment, as they are more aware of the market trends and regulations than the ordinary man - “a common investor” (Davis, 2001).
Institutional investments like pension funds have a great role in developing economies. Pension funds mount up the amount and number of investments attained by company employers in respect of their employees. The amount gets doubled and tripled after some time, depending on the rates on which it has been fixed, and adds a consistent share in the financial stock market until the policy gets expired. This is how regulations, policies and instrumentations of pension funds (institutional investment) retrieve the best outcome (liquid assets) for both investors and managers of the fund. The importance of pension institution funds vary with respect to the changing norms of countries’ markets. According to International Financial Services London (IFSL) 2004, UK projects an amount of $1,400 billion in the pension funds prospect, adding a major share in the UK’s financial stock market (BGL, 2010). ...Show more