Likewise, the TIAA-CREF
Lifecycle Fund series includes a tactical asset-allocation program that TIAA has modestly added over the past two years, says John Cunniff, managing director at TIAA and manager of the funds.
You may notice a strange investment plan, such as 50% in a
lifecycle fund and 50% in money market funds.
The real estate allocation of the TIAA-CREF
Lifecycle fund series will typically range between 1% to 5% of each portfolios' assets employing a core investment style focused on institutional-quality US commercial real estate investments primarily in office, industrial, retail and multi-family residential properties that seek to generate returns primarily from rental income with asset appreciation as a secondary goal.
DeWitt, director of
lifecycle fund research at FRC, warns that investors need to be careful about investing in target-date funds because of the funds' lack of transparency.
When you're choosing retirement investments, think carefully about whether a
lifecycle fund is right for you.
"But the move can throw a delicately allocated
lifecycle fund off balance."
Answer--A
lifecycle fund is a diversified mutual fund-one that automatically shifts towards a more conservative mix of investments as it approaches a particular year in the future, known as its "target date" (hence, these funds are also sometimes referred to as "target-date funds").
And last August, TIAA-CREF fit direct real estate into its mutual-fund-based
Lifecycle Fund series.
"The opportunity to include direct real estate as part of our TIAA-CREF
Lifecycle Fund series allocation provides us with the ability to further diversify, reduce volatility and improve investment outcomes," said John Cunniff, managing director at TIAA Investments and portfolio manager of the TIAA-CREF Lifecyle Fund series, in a statement.
In general terms, the asset-allocation model in a target-date fund, also known as a
lifecycle fund, is designed to move money from riskier investments such as stocks to more conservative alternatives such as bonds, as investors approach a date close to their expected retirement.
Lipper recently named Nuveen the Best Overall Large Fund Company for the fifth year in a row and the Best Mixed Assets Large Fund Group for the second consecutive year, for its multi-asset strategies, including the TIAA-CREF
Lifecycle Fund series and the TIAA-CREF Lifecycle Index Fund series.
"For those plan sponsors that pick QDIAs, they are taking advantage of the safe harbor status and, if they select a target-date or
lifecycle fund or managed account product, [of] the changing of asset allocations over time.
