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Article: Target date funds must earn the trust of retirement industry; Performance swings bring modifications by firms, scrutiny in Washington.(News)
- Article from:
- Investment News
- Article date:
- October 12, 2009
CopyrightCOPYRIGHT 2009 Crain Communications, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Byline: Sue Asci
WHILE LAST year's unpredictable performance may not mean the end of target date funds, it did signal coming changes that could affect how they are structured and sold in the future.
In fact, many firms already modified the investments held in the funds, and lawmakers and regulators are eyeing changes in disclosure.
Target date funds, designed to be a one-stop retirement solution, use a mix of stock and bond allocations that shift over time, becoming more conservative as the strategy approaches a specific date.
Last year, target 2010 funds, which were held by investors closest to retirement, held vastly different asset ...