Skip to Content

US Videos

Not All Target-Date Funds Have the Same Pattern

Stock and bond movements in 2014 have created a wide range of outcomes among target-date series from different providers.

Not All Target-Date Funds Have the Same Pattern

Janet Yang Rohr, CFA

May 8, 2014

Janet Yang: So far in 2014, we've seen some pretty interesting performance patterns coming from target-date funds. Basically you have your shorter-dated 2015, 2020 funds actually outperforming your longer-dated funds such as the 2045, 2050 funds.

And to see why that happened, just look at what happened in the markets. And basically you'll see that fixed-income funds, fixed income in general, outperformed equity markets. And so target-date series with fewer equities generally tended to do better.

Basically your Wells Fargo funds and the PIMCO target-date series, for example, did pretty well in the first four months of 2014. On the other hand, series with more equities, such as the T. Rowe Price series or the AllianceBernstein series, tended to lag their peers.

There is a pretty wide range of outcomes. I think that just serves as a reminder to investors that it's not just as simple as picking a target-date fund, and it really helps to look underneath the hood to see what you're getting.

Transparency is our policy. Learn how it impacts everything we do

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

How we make money

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your personal data

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

Verify your identity, personalize the content you receive, or create and administer your account.
Provide specific products and services to you, such as portfolio management or data aggregation.
Develop and improve features of our offerings.
Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

How we approach editorial content

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.