Products
Investment Product and Service Launches
John Hancock announces second round of reduced fees, and Voya Financial releases new TDF solution.
Tag: target-date funds
Mixed TDF Investors’ ‘Sophistication’ May Be Hurting Them
Research explored the allocation decisions of 30,516 mixed target-date fund (TDF) investors to determine which types of investors are more susceptible to mixing TDFs and how they mix them.
Lawsuit Over TDFs Names Provider as Defendant
Participants in the CHS/Community Health Systems, Inc. Retirement Savings Plan have filed a lawsuit against the company, its retirement plan committee and the provider of target-date funds (TDFs) in the plan for maintaining excessively expensive and poorly performing underlying investments.
Litigators Share What They Investigate for Filing TDF Lawsuits
A litigation firm has listed what it is investigating for potential lawsuits over target-date funds (TDFs) in retirement plans, and an ERISA attorney makes suggestions for how plan fiduciaries may avoid such suits.
Walgreen 401(k) Participants Seek $300M in Lawsuit Over TDF Mismanagement
The complaint says the target-date funds used in the plan and as the designated default investment were underperforming since they were selected, resulting in a great loss to participants.
Small Business Employees Benefiting From Enhanced DC Plan Design
The adoption of enhanced defined contribution (DC) plan features has led to increased plan participation and optimized portfolio construction for small business employees, according to Vanguard.
Volatility and TDFs: The Good, the Bad and the Unintended
John Greves, Natallia Yazhova and Jake Gilliam, with Charles Schwab, discuss volatility as it relates to target-date funds (TDFs) and how plan sponsors may want to re-examine risk exposures in these vehicles.
Products
Investment Product and Service Launches
Morgan Stanley builds low-minimum impact portfolio suite; American Century Investments decreases ETF management fee; Sun Life Financial consolidates asset management businesses; and more.
401(k) Participant Transfers Increase in May
Falling equity returns accelerated the trend this year of participants moving into fixed income investments, according to Alight Solutions.
Fidelity Takes on Vanguard With Fee Reductions
Fidelity investments is announcing a 14% price reduction on its target-date funds (TDFs), resulting in most of those funds having lower expense ratios than comparable Vanguard index target-date funds.
Despite Market Rebound, Investors Flocked to Fixed Income in Q119
Nearly 90% of the days in the quarter saw net trading activity favor fixed income, according to the Alight Solutions 401(k) Index.
Products
Investment Product and Service Launches
Finadium builds database of securities lending mutual funds and ETFs; OneAmerica, Russell Investments managed accounts consider outside retirement assets; and MainStay moves target-date funds to other asset allocation funds.
Plan Sponsors Actively Evaluating, Changing TDFs
A BlackRock survey shows four in 10 DC plan sponsors say they have changed or added TDFs in the past 12 months.
Active TDFs Offer Advantages for DC Plan Participants
Cerulli Associates points to active target-date fund (TDF) performance during market volatility and the ability to mitigate sequence of return risk for defined contribution (DC) plan participants as reasons to consider them.
DC Plan Participant Use of TDFs Continues to Grow
While target-date funds (TDFs) are intended to automatically diversify retirement plan participants’ portfolios, Vanguard found nearly one-third mix TDFs with other investments and “are pursuing what appear to be reasonable diversification strategies.”
Responsible Approaches to Tactically Managing TDFs
Target-date fund (TDF) providers use tactical strategies to support goals of the funds’ glide paths, but responding to a report from a professor of finance at London Business School, providers question whether there is a point where a tactical approach goes too far.
Trend in TDF Move to Passive Management Continues
Sway research finds target-date series that invest in passively managed underlying funds, as well as those that invest in collective investment trusts (CITs) have been increasing, while target-date series that invest in actively managed underlying funds saw their market share fall.
A Drop Off in Volatility in January Led to Scant Trading
It was the slowest start to the year in the 20-plus years of the Alight Solutions 401(k) Index.
Q4 2018 Market Drop Did Not Deter 401(k) Participants
Long-term 401(k) participation, savings and investing trends have also been positive, due in no small part to automatic plan features, according to a report from Fidelity Investments.
DC Plan Sponsors Slow to Adopt Hybrid QDIAs
Just as defined contribution (DC) plan sponsors were once concerned about automatically enrolling employees in the plan when they didn’t actively select it, they have hesitations about using qualified default investment alternatives (QDIAs) that automatically place participants in a managed account.