Vanguard expands commission-free ETF transactions; MassMutual and T. Rowe Price create TDF collaboration; Johnson Investment Counsel adds Charles River as wealth management business; and more.
Tag: target-date funds
In addition, Vanguard found among its book of business a large increase in the number of small businesses offering retirement plans to employees.
There are a number of investment vehicles to consider when drafting a plan menu that best suits the plan's participants.
“[When] investors commit to consistent investment regimes, investor returns are strong and the gaps are often positive," Morningstar says.
Vanguard believes it’s an important part of due diligence to consider custom options.
When constructing their own retirement portfolio, about 10% of participants still hold extreme allocations—either 0% or 100% equities.
MassMutual introduces new TDFs, and Krane Funds Advisors creates CIT for retirement plans.
According to Jake Tshudy at SEI, “An actuarial valuation approach akin to a DB plan is the best strategy to determine if a TDF series has the appropriate level of risk based on a plan’s demographics.”
Target-date fund designs should take into account the risks retirement plan participants face—how to correlate and corral the evolving sources of market, event, longevity, inflation and interest rate risks.
Average individual 401(k), 403(b) and IRA account balances increased year-over-year, according to the latest cut of data from Fidelity’s book of retirement business, but the average dipped slightly from Q4 2017, reflecting market volatility and the fact that new small-balance savers entered the fold.
However, an analysis from Alight Solutions found users of managed accounts see higher returns, are more diversified and save more in their DC plans than TDF users.
Russell Investments Presents New ESG Score Framework; Merrill Lynch Reveals New ESG Portfolios; EDHEC-Risk Institute Reexamines Retirement Products; and more.
The lawsuit questions the selection of underlying investments for the Principal LifeTime Hybrid Collective Investment Funds, alleging Principal used proprietary investment vehicles, rather than other investment vehicles, and share classes with higher fees.
One of the most common approaches to valuing managed account services is to compare historical investment performance with a target-date fund or similar benchmark; Empower Retirement argues there is a better approach that involves considering “an alpha-equivalent measure.”
Putnam announces new pricing for TDFs; First Trust to launch AI and Robotics ETF; and Vanguard launches factor-based ETFs.
ERISA requires plan sponsors to regularly monitor investment lineups to ensure they remain prudent—a task made more complicated by the multi-layered construction of target-date funds; a new paper points to the best practices of defined benefit plans for some guidance.
“The world is moving toward big data, and thus far as an industry we haven’t been able to use big data in a meaningful way. We are now in the midst of a paradigm shift that will allow plan sponsors to make data-driven decisions in an entirely new way,” says Thomas Idzorek, with Morningstar Investment Management.
BCG adds 401(k) managed account from Stadion to recordkeeping platform; Mercer partners with Investment Metrics for client reporting; BCM TDF series to offer protection within uncertainty; and more.