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URL:  http://boards.fool.com/oh-and-the-cost-to-reduce-the-bumpiness-about-30876610.aspx

Subject:  Re: Hi gang... wow!!! Date:  9/18/2013  5:51 PM
Author:  synchronicityII Number:  73047 of 89479

Oh, and the cost to reduce the bumpiness? About $440,000. That's a big cost to solve a problem that volatility is willing to fix for you for free after a few years.

Another way of looking at it is the classic "efficient frontier" type of thing - calculate the standard deviation of IUL returns (obviously taking the parameters for a specific product from a specific company), find a mix of, say S&P and bonds (VTSMX and VBMFX, for example) that has the same standard deviation, and then see what the IRRs are for both strategies.

-synchronicity
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