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Investing April 22, 2009
Target Dates Down but Still Beat Index
April 22, 2009 (PLANSPONSOR.com) - Ibbotson
Associates reports that the first quarter of 2009 is the 6th
quarter in a row that the average target maturity fund
experienced a loss.
Reported by Rebecca Moore
According to the Target Maturity Report, the average target maturity fund declined 7.4% during the first quarter, while the S&P 500 Index lost 11%. On an annual basis, the average target maturity fund lost 31.7%, while the S&P 500 Index lost 38.1%
Ibbotson noted that over the years as the number of fund families increased dramatically, equity exposure increased. For investors of equivalent ages above 39 years old, the average 2009 glide path has 4% more equity exposure than the average 2004 path, the report said.
According to Ibbotson, the propensity of investors to focus on absolute return rather than risk-adjusted returns led some fund manufacturers to adopt more aggressive glide paths, but the firm advises investors, advisers, and plan sponsors to consider their unique risk preferences and risk capacity when establishing or selecting an appropriate glide path.
Beginning with this quarterly report, Ibbotson included performance information on the recently released Morningstar Lifetime Allocation Indexes as an aid in benchmarking.
More information is at www.ibbotson.com .
align="left">Quarterly Target Maturity Fund Performance (Q1 - 2009)
align="left"> Date Max Average Min # of Funds
align="left">Income 0.9% -3.3% -10.5% 24
align="left">2000 -1.9% -3.3% -4.7% 2
align="left">2005 -3.4% -4.6% -5.7% 7
align="left">2010 -0.5% -4.7% -7.5% 32
align="left">2015 -1.7% -6.1% -12.2% 30
align="left">2020 -2.7% -6.7% -9.8% 36
align="left">2025 -4.3% -8.0% -11.6% 27
align="left">2030 -4.4% -8.4% -11.2% 36
align="left">2035 -5.1% -9.2% -11.9% 26
align="left">2040 -4.6% -9.3% -11.9% 35
align="left">2045 -5.8% -9.7% -12.9% 22
align="left">2050 -3.8% -9.4% -12.3% 24
align="left">2055 -6.7% -8.9% -10.1% 3
align="left"> Total 304
align="left">Source: Ibbotson Associates
align="left"> Morningstar Lifetime Allocation Indexes
align="left"> (As of 3/31/09; multiyear periods annualized)1 Mo 3 Mo 1 Yr 3 Yr 5 Yr
align="left"> Income
align="left">Conservative Income 3.59 (0.54) (8.27) 2.23 3.23
align="left">Moderate Income 4.40 (2.37) (14.43) (0.39) 2.33
align="left">Aggressive Income 5.15 (4.04) (19.87) (2.82) 1.46
align="left"> 2000
align="left">Conservative 2000 3.63 (1.18) (8.97) 1.88 3.20
align="left">Moderate 2000 4.49 (3.01) (15.39) (0.85) 2.27
align="left">Aggressive 2000 5.31 (4.73) (21.21) (3.45) 1.34
align="left"> 2005
align="left">Conservative 2005 3.76 (1.96) (10.33) 1.26 3.07
align="left">Moderate 2005 4.68 (3.80) (17.06) (1.61) 2.10
align="left">Aggressive 2005 5.60 (5.59) (23.35) (4.45) 1.09
align="left"> 2010
align="left">Conservative 2010 3.96 (2.81) (12.20) 0.44 2.87
align="left">Moderate 2010 4.98 (4.71) (19.38) (2.66) 1.84
align="left">Aggressive 2010 6.04 (6.62) (26.36) (5.86) 0.67
align="left"> 2015
align="left">Conservative 2015 4.24 (3.71) (14.50) (0.56) 2.64
align="left">Moderate 2015 5.42 (5.77) (22.55) (4.09) 1.45
align="left">Aggressive 2015 6.62 (7.78) (30.14) (7.67) 0.01
align="left"> 2020
align="left">Conservative 2020 4.65 (4.74) (17.58) (1.89) 2.32
align="left">Moderate 2020 6.06 (7.01) (26.76) (6.02) 0.79
align="left">Aggressive 2020 7.26 (8.88) (34.04) (9.59) (0.79)
align="left"> 2025
align="left">Conservative 2025 5.27 (5.97) (21.88) (3.78) 1.74
align="left">Moderate 2025 6.77 (8.22) (31.23) (8.15) (0.07)
align="left">Aggressive 2025 7.78 (9.68) (37.08) (11.11) (1.48)
align="left"> 2030
align="left">Conservative 2030 6.01 (7.23) (26.71) (5.97) 0.91
align="left">Moderate 2030 7.37 (9.12) (34.78) (9.88) (0.85)
align="left">Aggressive 2030 8.07 (10.07) (38.70) (11.91) (1.84)
align="left"> 2035
align="left">Conservative 2035 6.66 (8.23) (30.77) (7.87) 0.08
align="left">Moderate 2035 7.71 (9.59) (36.77) (10.85) (1.29)
align="left">Aggressive 2035 8.16 (10.17) (39.24) (12.13) (1.89)
align="left"> 2040
align="left">Conservative 2040 7.05 (8.77) (33.09) (8.96) (0.40)
align="left">Moderate 2040 7.84 (9.74) (37.51) (11.17) (1.38)
align="left">Aggressive 2040 8.20 (10.17) (39.44) (12.16) (1.83)
align="left"> 2045
align="left">Conservative 2045 7.22 (8.97) (34.06) (9.38) (0.54)
align="left">Moderate 2045 7.90 (9.78) (37.82) (11.26) (1.35)
align="left">Aggressive 2045 8.22 (10.15) (39.57) (12.16) (1.74)
align="left"> 2050
align="left">Conservative 2050 7.30 (9.06) (34.54) (9.56) (0.56)
align="left">Moderate 2050 7.93 (9.78) (38.02) (11.29) (1.28)
align="left">Aggressive 2050 8.24 (10.13) (39.69) (12.15) (1.65)
align="left"> 2055
align="left">Conservative 2055 7.33 (9.04) (34.74) (9.61) (0.56)
align="left">Moderate 2055 7.95 (9.74) (38.13) (11.29) (1.25)
align="left">Aggressive 2055 8.26 (10.09) (39.81) (12.15) (1.62)