life-cycle fund


Also found in: Acronyms.

Lifecycle Fund

Any mutual fund in a fund family that offers funds with varying levels of risk that are targeted at potential shareholders in different age groups. For example, a fund family may offer three lifecycle funds, one aimed at investors in their 20s and 30s, one at persons in their 40s and 50s, and one for those nearing or in retirement. In this situation, the first fund will carry the most risk because younger investors often seek to make a large return while the third will carry the least risk as investors wish mainly to protect their savings and pensions.

life-cycle fund

A mutual fund that maintains a certain mix of stocks and bonds in order to attract investors of a given age and risk preference. Mutual fund families sometimes offer several different life-cycle funds with various asset allocations so as to appeal to investors of different ages.
References in periodicals archive ?
With life-cycle funds, the allocations for investors vastly improve."
Interested in life-cycle funds? "These funds are the easiest investments you can make, but you still need to do research to make the best decision," says Clark.
The product can also be applied to life-cycle funds or to asset-allocation programs.
Broadly diversified, balanced, and life-cycle funds are designed to be held for the long haul and are good portfolio anchors.