Jul 10, 2022
This week Derek Moore notes the historic start to the year in bonds given the rise in interest rates and how low they were at the beginning of this cycle. Then Derek discusses target date funds. Popular in 401k plans, many investors don’t fully understand what they are and the different types of risks inherent in them.
Historic first half drawdown in the US Aggregate Bond Index
What are target date funds?
What is the glide path for target date funds?
What the intent of target date funds is
Why investors might believe they have less risk than they do
The 2008-09 experience for investors in target date funds
Post Great Financial Crisis hearings on target date funds
How target date funds with same date experienced so variation in returns
Examining some near-term retirement date funds
Chapter 2 from the book Broken Pie Chart and target date funds
Mentioned in this Episode:
Contact Derek Moore derek.moore@zegafinancial.com
ZEGA Financial www.zegafinancial.com
Public hearings 2009 on retirement target date funds https://www.sec.gov/spotlight/targetdatefunds/targetdatefunds061809.pdf