Fidelity Freedom Target-Dates Series

The Fidelity Freedom target-date series’ robust asset-allocation team has driven consistent, well-researched enhancements to its glide path over time. A stable of strong underlying funds also gives this series a leg up. It earns a Morningstar Analyst Rating of Silver for its cheapest K6 share class, while its pricier shares are rated Bronze.

Fidelity’s well-resourced asset-allocation team and tenured portfolio managers set this series’ allocations. Comanagers Andrew Dierdorf and Brett Sumsion stand at the helm, a partnership that dates to 2014. Both managers have a wealth of asset-allocation expertise, while nearly 70 investment professionals, including 32 research-focused team members, provide support. The team’s work informs any changes to the series’ long-term strategic allocations or shorter-term tactical shifts. The managers also have a stable of topnotch equity and bond managers at their disposal. Veteran managers like Ford O’Neil, Jed Weiss, and Steve Wymer, among others, run underlying Fidelity Series funds used across the glide path; each of their retail equivalent offerings earns a High People rating, and an Analyst Rating of Gold or Silver, as of December 2022.

The series benefits from Fidelity’s research-intensive approach to asset allocation. The team has implemented measured adjustments to the glide path over time, primarily focused on improving diversification. Since 2013, the team has made four substantial changes. Most recently, the team revamped the fixed-income sleeve’s strategic allocation starting in July 2021. The changes roughly doubled the exposure to Treasury Inflation-Protected Securities, split the allocation across two funds for more targeted positioning, marginally increased exposure to long-term U.S. Treasuries, and carved out dedicated exposure to international bonds.

The managers have leeway to shift the series away from its strategic allocation based on one- to five-year views. Although well-researched, the tilts have not consistently delivered. Active allocation has detracted from results during four of the past five calendar years, though 2022′s results through September were favorable. That said, the series has still delivered respectable long-term results. Over the trailing decade through December 2022, nine vintages outpaced their average target-date Morningstar Category peer on an absolute and risk-adjusted basis (as measured by Sharpe ratio).

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