Stable Value Is Better Than Bonds
Consensus forecasts continue to favor higher rates and low bond returns over the medium term. GMO, the Boston-based global investment firm, recently updated its 7-year real return forecast and projected a dire situation for most asset classes, including a projected -2.1% real return for U.S. bonds. Most investors understand the risk/return tradeoff expressed by stocks, […]
How plan sponsors should respond to 401(k) money market fund rules
Plan sponsors should consider stable value and guaranteed rate funds which guard against loss of principal but may have redemption fees and liquidation window restrictions. These funds have yields that are much higher than government and prime money market funds. Recent fiduciary breach lawsuits filed against plan sponsors for using money market funds instead of […]
ICMA-RC Seeks Senior Stable Value Fund Manager
The Senior Fund Manager will take a lead role in the co-management of proprietary stable value funds/portfolios and oversight of certain fixed income funds/portfolios and external asset managers. Such responsibilities will include working with the Managing Vice President, Fixed Income and other senior investment personnel, in developing and implementing stable value fund/portfolio strategies and the […]
Stable Value Funds: Risk Less And Earn More
During periods of market turbulence and low interest rates, many investors struggle to find investment alternatives that aren’t getting hammered. But those saving for retirement may be pleasantly surprised to discover a unique breed of mutual fund known as stable value funds. These funds are somewhat similar to money market accounts, except that they post […]
The 6 Most Popular 401(k) Investments
401(k) plan participants are given a limited menu of investment options and must choose how to allocate their retirement savings. Younger 401(k) investors tend to select equity funds, while older participants often have a growing interest in protecting part of their savings using bond funds, stable value funds and money funds. Many new 401(k) participants […]
Evaluating Capital Preservation Options
In light of US money market reforms, many defined contribution (DC) plan sponsors are weighing the pros and cons of their capital preservation choices in terms of yield, daily liquidity needs, net asset value stability and liquidity restrictions. DC plans have typically selected between money market and stable value funds as their capital preservation option. […]
Stable Value in the Spotlight
Sleepy. Quiet. Those are a couple of words that have been used to describe the capital preservation arena over the years. But with money market reform, we have seen capital preservation become one of the more significant investment policy topics during defined contribution (DC) client review meetings this year. Most DC plans presently offer a […]
Stable Value Roundtable: Stable Value Industry Strong, Getting Better
The stable value industry is in great shape, according to industry veteran Aruna Hobbs. It’s healthy and vibrant, with plenty of capacity. Cash flow is stable, and the asset class continues to deliver on its promise of principal preservation and steady returns for retirement plan participants. While the trajectory of the industry is positive, like […]
Can Stable Value Funds Keep Pace with Inflation?
The financial markets have historically experienced volatility and market uncertainty, which remain key themes in today’s markets. Investors saving for retirement are challenged to find strategies to generate enough income after inflation to last through their retirement years. Even modest inflationary pressures can eat into retirement savings and reduce actual purchasing power of money. This […]