Amtrak 2013 Annual Report Download - page 96

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National Railroad Passenger Corporation and Subsidiaries (Amtrak)
Notes to Consolidated Financial Statements (continued)
1411-1359280 57
13. Postretirement Employee Benefits (continued)
Plan Assets
The Company’ s pension plan asset allocation at September 30, 2013 and 2012, and target
allocation for 2014, are as follows:
Plan Assets
2014 2013 2012
Domestic equity securities 18-38% 29.8% 26.9%
Global asset allocation funds 20-30% 28.4% 29.9%
Fixed income securities 13-23% 16.1% 16.6%
Common/collective trust 6-16% 18.6% 19.2%
Real estate investment trust 0-10% 5.0% 4.9%
Money market funds 0-5% 2.1% 2.5%
The investment strategy for pension plan assets is to invest the assets in a manner whereby long-
term earnings on the assets provide adequate funding for retiree pension payments. The
investment objectives of the pension fund are to: (1) promote the growth in the plan’ s funded
status, to the extent appropriate, minimizing reliance on employer contributions as a source of
benefit security, (2) invest the assets of the plan to achieve the greatest reward consistent with a
reasonable and prudent level of risk, and (3) achieve, as a minimum over time, the passively
managed asset return earned by market index funds, weighted in the proportions outlined by the
asset class exposures identified in the plan’ s strategic allocation.
Assets are strategically allocated among equity, fixed income securities, real estate and global
asset allocation managers who have the ability to invest in stocks, bonds, and other assets in the
U.S. and abroad in order to achieve diversification of investments and to reduce volatility in
investment returns as well as maintain flexibility for the managers to allocate assets to areas of
the market they believe have greater upside potential while avoiding areas of the market that they
believe are likely to underperform. The asset allocation is evaluated and rebalanced to return
each of the asset classes back to the target range percentage within 6-8 weeks following the end
of each quarter, unless the Retirement Investment Committee determines otherwise. As a result
of the asset allocation diversification strategies, there are no significant concentrations of risk
within the portfolio of investments.