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The website you are accessing is created and maintained by another entity. We make no representation or warranty with respect to the information contained on the site or that it is appropriate in all jurisdictions or countries, or for use by all investors or counterparties. The products and services discussed at this site may not be appropriate for sale or use by all investors or counterparties. By providing this link, we are not providing you with investment advice or offering securities for sale to you. All persons and entities that access this site do so on their own initiative and are responsible for compliance with applicable local laws and regulations.

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The website you are accessing is created and maintained by another entity. We make no representation or warranty with respect to the information contained on the site or that it is appropriate in all jurisdictions or countries, or for use by all investors or counterparties. The products and services discussed at this site may not be appropriate for sale or use by all investors or counterparties. By providing this link, we are not providing you with investment advice or offering securities for sale to you. All persons and entities that access this site do so on their own initiative and are responsible for compliance with applicable local laws and regulations.

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Insights

Insights   •   Demographics & Retirement

Evolution of the Glidepath

Does one size fit all? When it comes to target date funds, it depends on diversification. The provider who offers the most thoughtfully curated mix of asset classes to enable the smoothest savings journey will be better able to serve the influx of participants drawn to the default. State Street has stepped up to this challenge.

Thanks to a combination of low cost, low complexity and elevated access to institutional-grade investments, the default dominates. Since the 2000s, investment in target date strategies has steeply increased. By 2021, these strategies are predicted to capture 85% of participant contributions, according to Cerulli Associates’ 2016 U.S. Defined Contribution Distribution report.

At State Street, our target date fund (TDF) glidepath has evolved to encompass a more sophisticated mix of asset classes, an approach that better manages outcomes across varied market scenarios. This precision means more as participants turn towards TDFs as their primary retirement savings solution. Our solution works on two levels:

  1. On the surface, State Street continues to offer a smooth and seamless user experience.
  2. Inside the strategy, our TDFs are intricate and elegant enough to accommodate wide-ranging risk and reward scenarios. This sophisticated asset class diversification is crucial as it’s endeavoring to safeguard a person’s hard-earned life savings.

By investing for the long run, our glidepath doesn’t react to changes in the market, but instead has been built for them — and for a future driven by the default.

Disclosures

The views expressed in this material are the views of SSGA Defined Contribution as at 24 June 2019, and are subject to change based on market and other conditions.

This document contains certain statements that may be deemed forward looking statements. Please note that any such statements are not guarantees of any future performance, and actual results or developments may differ materially from those projected.

Investing involves risk including the risk of loss of principal. Diversification does not ensure a profit or guarantee against loss.

The information provided does not constitute tax or investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. Investing involves risk, including the risk of loss of principal. The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without SSGA’s express written consent.


2571149.1.1.GBL.RTL

Exp: 06/30/2020
 

Questions? Feel free to

This information is for informational  purposes only, not to be construed as investment advice or a recommendation or offer to buy or sell any security. Investors should always obtain and read an up-to-date investment services description or prospectus before deciding whether to appoint an investment manager or to invest in a fund. Any views expressed herein are those of the author(s), are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may make different investment decisions for different clients. There are no guarantees regarding the achievement of investment objectives, target returns, portfolio construction, allocations or measurements such as alpha, tracking error, stock weightings and other information ratios. The views and strategies described may not be suitable for all investors. SSGA does not provide tax or legal advice. Prospective investors should consult with a tax or legal advisor before making any investment decision. Investing entails risks and there can be no assurance that SSGA will achieve profits or avoid incurring losses.

Performance quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, so you may have a gain or loss when shares are sold. Current performance may be higher or lower than that quoted.

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