Our guide to
the size, scope
and design of
The data submitted this year for the Target-Date Fund (TDF) Buyer’s Guide, compiled by sister publication PLANSPONSOR, reinforces trends seen when first compiling this guide, in 2015. One was that asset managers are deeply
committed to target-date fund solutions, as indicated by an exceptionally high
research participation rate—74 products—which encompasses 99% of the total
TDF marketplace by assets. Second, target-date funds, and their managers,
continue to evolve their thinking and underlying allocations.
The 2017 TDF Buyer’s Guide represents $1.6 trillion in assets as of June 30. Of
the target-date fund market reported, 60% of products are in mutual funds, 37%
in collective investment trusts (CITs) and 3% in variable portfolios.
The following analysis is based on the 71 off-the-shelf, or prepackaged,
products—custom solutions are excluded—listed starting on page 54. A slightly
expanded guide is available online.
Key to any adviser and plan sponsor due diligence process that involves fund
differentiation is to examine the asset manager’s philosophy and methodologies,
such as how they use passive management or unaffiliated investment managers.
About 38% of the off-the-shelf TDF families— 28 of those listed in our guide—
use a hybrid or active/passive method of portfolio construction. Another 28%— 21
suites—primarily use active underlying funds, and 27%— 20 suites—favor index
or passive underlying funds. The remainder cited something else in that field.
Art by JooHee Yoon
FOCUS TDF o n t h e
2017 TARGET-DATE FUND BUYER’S FUND GUIDE