The Dow Jones Target Date Indexes and Dow Jones US Target Date Indexes each comprise 10 indexes with “target dates” set at five-year intervals out to 45 years, according to a press release from the company. The index series has been licensed to State Street Global Advisors.
The funds will use the global Dow Jones Target Date Indexes as a benchmark. The Dow Jones Target Today, Dow Jones Target 2015, Dow Jones Target 2025, Dow Jones Target 2035 and Dow Jones Target 2045 funds will aim to provide a solution for employee investments with a hands-off investment approach that gradually grows more conservative as the target year indicated in the fund’s title draws near.
Each Dow Jones Target Date Index allocates among stocks, bonds and cash on a monthly basis. The global index series includes nine Dow Jones equity indexes, four Lehman bond indexes, the Lehman Brothers Government Bond Index, Lehman Brothers Corporate Bond Index, Lehman Brothers Mortgage Bond Index and Lehman Brothers Majors (ex US) Index and the Lehman one-to-three months T-bill index as the cash component, according to the company.
The US target index series is made up of six Dow Jones equity indexes, three Lehman bond indexes and the Lehman one-to-three months T-bill index. Over the life of each index, the relative risk ranges from 90% of the risk of the global equity market at its most aggressive point, to 20% of the global equity markets risk at its most conservative pointwhen the index reaches its target date. At this point, each index will convert into the Dow Jones Today index, with a constant 20% relative risk exposure.
The launch of each index is April 1.