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“What’s In My Target Date Fund?” Isn’t The Only Question That Needs To Be Asked About TDFs
Given the large amounts of money flowing into target date funds, more effort by plan sponsors and participants should be devoted to understanding the methodology that the managers of the funds are using to manage the “glide path” of the fund. The reason that TDFs are so popular is because of the belief that these are “set it and forget it” funds that the underlying managers are taking care... -
Using Managed Accounts as Qualified Default Investment Alternatives (QDIAs)
Target Date Funds have long dominated the 401(k) Qualified Default Investment Alternatives world, but that could begin to change as participant’s financial situations become too complex for simple TDFs, and as competition drives down the fees of managed accounts. Managed accounts, while charging higher fees, allow for the use of ETFs, broader asset class allocation, and can offer a more holistic option for participants, taking into account other investments,... -
Largest University Endowments Afford Their Schools Competitive Advantage
A recent article by CNBC economics reporter John W. Schoen provides an in-depth look into reasons behind the rising cost of higher education in the U.S. It’s a complicated issue, with many moving parts. The after-effects of the 2008 recession, expanding student services, required budgetary expansion in state budgets, such as pensions, healthcare and Medicaid, and other issues have forced schools to increase the student tuition costs. The improved... -
S&P 500 Has Not Corrected 10% in More Than 3 1/2 Years
The S&P 500 has gone more than 3½ years without experiencing a 10% correction, according to Bespoke Investment Group. It is now the second longest stretch without a 10% correction since 1929. The longest is seven years (10/90-10/97). On average, the S&P 500 experiences a 10% correction about every 18 months, according to S&P Capital IQ. Source: First Trust’s “Factoid of the Day”.