PIMCO Launches Target-Date Suite

April 2, 2008 (PLANSPONSOR.com) - PIMCO has announced the launch of PIMCO RealRetirement Funds, a series of funds the firm says is designed help defined contribution plan sponsors assist their participants in addressing a number of key issues.

Those issues include:

  • Meeting their retirement income goals,
  • Reducing volatility along the way, and
  • Protecting them from inflation.

The five PIMCO RealRetirement Fund are differentiated by target retirement dates for 2010, 2020, 2030, 2040, and 2050.   According to the announcement, each fund of funds contains allocations of various PIMCO Funds that include or have exposure to domestic and international securities as well as real assets such as TIPS, real estate and commodities.

“Real” Difference

In a press release, PIMCO says that its retirement solutions “…differ from many older and less diversified types of target date funds, which have been highly concentrated in equities even as they approach the retirement date, when investors are less tolerant to the risk and volatility inherent in many equity strategies. In contrast, PIMCO’s RealRetirement Funds incorporate real assets — Treasury Inflation-Protected Securities (“TIPS”), commodities, and real estate.”

“Unlike many of the target date products in the market today, PIMCO’s retirement solutions focus on facilitating adequate retirement purchasing power, which is the primary success factor of many plan sponsors,” said Stacy Schaus, senior vice president and PIMCO’s Defined Contribution Practice Leader. “An additional important element to PIMCO’s approach is reducing volatility by incorporating a broader range of asset classes, especially as the fund moves closer to its target date.”

“PIMCO’s RealRetirement Funds differ from products in the market today because of our focus on reducing risk, particularly from inflation,” Schaus added. “We believe PIMCO’s RealRetirement Funds are attractive for sponsors of defined contribution retirement plans who focus on retirement income replacement.”