Key Facts
—The change. Chile is replacing its five multifondos with ten generational funds assigned by age, the biggest shift to pension investing in decades.
—The stake. The pension managers oversee roughly $260bn, and the new rules will govern how all of it is invested.
—The mechanism. Managers who beat a reference portfolio are paid from the fund; those who lag must pay into it.
—The objection. To earn a reward, a fund must post an information ratio above 0.33, a threshold the pension law never mentions.
