Target Date Solutions: Active, Passive or Custom?
Plan sponsors are implementing target date strategies in a number of ways. Some are opting for an unbundled, or "open architecture," approach over an off-the shelf, single manager solution, while others are considering low-cost passive strategies. More plan sponsors, meanwhile, are considering a passive blend approach that combines active management in less efficient markets and asset classes with index management in more efficient areas, such as U.S. stocks.
Customized target date solutions are also being evaluated by plan sponsors in situations where they can tailor a glide path for their participants or use the existing managers in their plan line-up.
Next steps
To learn more about our complete target date capabilities including our tools and resources, contact your J.P. Morgan representative or email jpmam.info@jpmorgan.com
Defined Contribution Investment Solutions
- Target Date Funds
Defined Contribution Investment Solutions
A passive blend approach to target date solutions
Penny wise, pound foolish (pdf)
A combination of active and passive strategies can provide potentially better diversification benefits and increase participant outcomes compared to a purely passive approach.
A combination of active and passive strategies can provide potentially better diversification benefits and increase participant outcomes compared to a purely passive approach.
Customized target date solutions
Customized target date solutions (pdf)
An increasing number of large plan sponsors are finding that a customized target date approach may be more suitable for their particular plan needs.
An increasing number of large plan sponsors are finding that a customized target date approach may be more suitable for their particular plan needs.
Target date tools and resources
Target Date Compass for Plan Sponsors (pdf)
A prudent fiduciary framework for evaluating and selecting a plan's target date solution.
A prudent fiduciary framework for evaluating and selecting a plan's target date solution.
Decoding Target Date Fund Design (pdf)
Gain a deeper understanding about the complexities behind TDF outcomes by examining different components of fundamental portfolio design.
Gain a deeper understanding about the complexities behind TDF outcomes by examining different components of fundamental portfolio design.
Target date insights
Taking real-world participant behavior and savings patterns into account is critical in determining a target date strategy that may best meet a particular plan's needs and goals.
Watch portfolio manager Daniel Oldroyd discuss options plan sponsors can consider when selecting a target date strategy for participants.
Opinions and statements of financial market trends that are based on current market conditions constitute our judgment and are subject to change without notice. We believe the information provided here is reliable but should not be assumed to be accurate or complete. The views and strategies described may not be suitable for all investors.
Target date strategies are strategies with the target date being the approximate date when investors plan to start withdrawing their money. Generally, the asset allocation of each strategy will change on an annual basis with the asset allocation becoming more conservative as the strategy nears the target retirement date. The principal value of the strategy(s) is not guaranteed long-term, including at the target date.
IRS Circular 230 Disclosure: JPMorgan Chase & Co. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters contained herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone unaffiliated with JPMorgan Chase & Co. of any of the matters addressed herein or for the purpose of avoiding U.S. tax–related penalties.
Target date strategies are strategies with the target date being the approximate date when investors plan to start withdrawing their money. Generally, the asset allocation of each strategy will change on an annual basis with the asset allocation becoming more conservative as the strategy nears the target retirement date. The principal value of the strategy(s) is not guaranteed long-term, including at the target date.
IRS Circular 230 Disclosure: JPMorgan Chase & Co. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters contained herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone unaffiliated with JPMorgan Chase & Co. of any of the matters addressed herein or for the purpose of avoiding U.S. tax–related penalties.
FOR INSTITUTIONAL USE ONLY
This website is intended to report solely on the investment strategies and opportunities identified by J.P. Morgan Asset Management. Additional information is available upon request. Information herein is believed to be reliable but J.P. Morgan Asset Management does not warrant its completeness or accuracy. Opinions and estimates constitute our judgment and are subject to change without notice. Past performance is not indicative of future results. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The investments and strategies discussed herein may not be suitable for all investors; if you have any doubts you should consult your J.P. Morgan Asset Management Client Adviser, Broker or Portfolio Manager. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommendations. You should consult your tax or legal adviser about the issues discussed herein.
J.P. Morgan Asset Management is the marketing name for the asset management businesses of JPMorgan Chase & Co. Those businesses include, but are not limited to, J.P. Morgan Investment Management Inc., Security Capital Research & Management Incorporated and J.P. Morgan Alternative Asset Management, Inc.
This website is intended to report solely on the investment strategies and opportunities identified by J.P. Morgan Asset Management. Additional information is available upon request. Information herein is believed to be reliable but J.P. Morgan Asset Management does not warrant its completeness or accuracy. Opinions and estimates constitute our judgment and are subject to change without notice. Past performance is not indicative of future results. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The investments and strategies discussed herein may not be suitable for all investors; if you have any doubts you should consult your J.P. Morgan Asset Management Client Adviser, Broker or Portfolio Manager. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommendations. You should consult your tax or legal adviser about the issues discussed herein.
J.P. Morgan Asset Management is the marketing name for the asset management businesses of JPMorgan Chase & Co. Those businesses include, but are not limited to, J.P. Morgan Investment Management Inc., Security Capital Research & Management Incorporated and J.P. Morgan Alternative Asset Management, Inc.