Inside this recentMorningstar articleabout the pros and cons of Fidelity’s Freedom Funds was an interesting chart that incorporated data from all of the target-date retirement funds. These funds were getting really popular as a set-and-forget type of investment, until many people found found ou...
Target-date funds are the undeniable leaders in the retirement saving industry. As the default investment vehicle for most employees with defined contribution plans, TDFs have surged in popularity over the years. “Target-date funds have been very effective as a way to get millions of participants...
With U.S. plan participants holding $2.75 trillion in 401(k) plans and $4.16 trillion in all employer-based defined-contribution (DC) retirement plans, according to ICI, the assets held in target date funds are forecast to continue to grow rapidly.Torregrosa...
Pros and cons of target-date funds As with any investment product, target-date funds have benefits and drawbacks. Whether they're a good fit for you depends on whether the pros outweigh the cons when you look at them compared with your investment objectives. Pros of target-date funds Simpl...
So when it comes to expenses, target-date funds compare well to the average mutual fund,though the average expense ratio is still higher than the average ETF. Disadvantages of target-date funds Of course, target-date funds have some disadvantages compared to other funds. ...
investors may be subject to a different risk profile compared to the fund's neutral asset allocation strategy shown in its glide path. The funds are subject to the volatility of the financial markets, including that of equity and fixed income investments in the U.S. and abroad, and may be...
The T. Rowe Price target date trusts, and their underlying trusts (the Trusts) are not mutual funds; rather the Trusts are operated and maintained so as to qualify for exemption from registration as mutual funds pursuant to Section 3(c)(11) of the Investment Company Act of 1940, as amende...
Are Target-Date Funds Expensive? In general, a target-date fund will have somewhat higher expense ratios compared to a standard mutual fund. This is because the target-date fund, even if it is an index target-date fund, is essentially a fund-of-funds that invests in other mutual funds. ...
We document a reduction in both the level and cross-sectional dispersion of systematic risk in the target-date fund (TDF) market after 2008, which resulted in better performance of TDFs during the COVID-19 selloff compared to the 2008 selloff and a reduction in TDF return dispersion. We ...
In recent years, a handful of asset managers like iShares have introduced target-date ETFs. These funds combine the automated asset allocation of target-date funds with ETFs' low fees and the ability to trade like shares. However, target-date ETFs are still relatively new. They might have low...