What Workers Get—and Don’t Get—About Target-Date Funds
Target-date funds have gained strong approval among US defined contribution (DC) plan participants who use them, as I have written before. But results from our seventh annual survey suggest that many US DC plan participants still have some mistaken notions about what target-date funds are…and are not.
read moreUS to Play Bigger Role in Global Economic Recovery
The forces driving the global economy are changing. We expect the US economy to take on a bigger role in the global recovery in 2012, while growth in emerging markets decelerates from the fast pace in 2011.
read moreAre Traditional Annuities Bad for Your Wealth? A UK Perspective
Roughly 90% of defined contribution (DC) savers in the UK still buy fixed-rate immediate annuities at retirement. Does this make sense for UK workers, and is there a lesson to be learned for the US?
read moreAre Utility Bonds Vulnerable to a Municipal Raid?
A reader who saw our recent article, “Navigating Rocky Municipal Bond Markets,” asked whether any essential service bonds were downgraded this year, and suggested that municipal bond issuers might load up, or even hide, excess debt in its water districts. Here’s the reply from Joseph Rosenblum and our municipal credit team.
read moreThe Power of Diversifying by Investment Time Horizon
No portfolio is protective in all environments, but the best risk-management strategy is to maintain exposure to well-chosen investments and strategies with short, intermediate and long time horizons. Each group will be poised to outperform in different markets and in response to different investor moods.
read moreEurope’s Fiscal Compact: A Very Modest Step Forward
The fiscal compact that the leaders of most European Union countries agreed on last week to bring some order to the euro area was broadly in line with expectations. While it may eventually be seen as a first step towards true fiscal union, it is more like a pistol than the long-awaited big bazooka.
read moreFoundation Strategies for an Era of Sub-Par Investment Returns
In my last post I argued that today’s unusually low prospective returns for bonds and near-normal prospective returns for equities will make it very difficult for foundations and endowments to achieve their long-term goals. Here’s our take on the alternative strategies that foundations and endowments should consider.
read moreMore on Dim Sum Bonds
A reader of my recent article on dim sum bonds, which was reposted on Seeking Alpha, expressed confusion about what action we recommend. While we are not, per se, making recommendations, here’s a clarification of what I meant.
read moreIs the Euro Zone at the Beginning of the End of Muddling Through?
This week’s series of high-level meetings in Europe is being billed as make or break for the euro. The good news is that European politicians finally seem to realize the extreme seriousness of the current situation. But any agreement at this Friday’s summit of all 27 euro-area countries is likely to stop short of anything [...]
read moreThe Perils of Past Performance, Part 1
In November, legendary equity investor Bill Miller stood down as portfolio manager of the Legg Mason Capital Management Value Trust, after underperforming in four of the past five years. Does this mean Miller had lost his touch?
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