PLANSPONSOR - February/March 2019 - 56

INVESTMENT FOCUS
The Best
Of Both
Worlds
Multi-asset funds
have more ways to
react to a dynamic
market environment
I
n the beginning, the mutual fund
industry created the balanced fund.
Well, nearly the beginning: U.S. openended
mutual funds first appeared in
1924, holding exclusively stocks, but
in 1928, a fund that balanced its capital
among stocks, bonds and cash opened
its doors. Now known as Vanguard
Wellington, it thrives to this day, with
$96 billion in assets and a 90-year
return, annualized, of about 8%.
Early balanced funds maintained
rigid and conservative asset allocations
and have begotten many of today's
staple products that invest across asset
classes: target-date funds (TDFs),
target-risk funds and diversified real
return funds. More recently, fund
managers have offered allocation funds,
featuring bolder and more dynamic portfolios
in markets around the world. These
have struggled in a defined contribution
(DC) market that gravitates to options with
low cost and simplicity in strategies and
menus, but in today's dyspeptic markets,
they may offer investors a less bumpy ride.
David O'Meara, senior investment
consultant at Willis Towers Watson in
New York, says, " Many have a tilt toward
equities and would do really well most of
the time. Then exactly when you wanted
the diversification, they didn't provide
much because their strategies were
largely 'risk-on.' "
" Many balanced funds are legacies
of the time before the Pension Protection
Act and the major adoption since then of
target-date funds, " says Mark Anderson,
manager of the trust advisory group and
a member of the multi-asset research
team at consultants Callan Associates in
San Francisco.
Since then, old-school balanced funds
have been losing ground. " It's a story of
decline, mostly because of 'auto' features
in a target-fund-centric world, " observes
56 PLANSPONSOR.com February - March 2019 Art by Wesley Allsbrook
John Croke, head of multi-asset product
management at Vanguard Group in
Malvern, Pennsylvania.
Charles Shriver, a portfolio manager
in the multi-asset division of T. Rowe
Price Group in Baltimore, points out that
balanced funds made up 12% of DC assets
in 2010 but now are down to 5% or 6%.
Among the mutual fund industry's
new ideas has been that of the multi-asset
portfolio-a balanced fund more complex
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PLANSPONSOR - February/March 2019

Table of Contents for the Digital Edition of PLANSPONSOR - February/March 2019

Asset Consolidation
2019 Plan Sponsor of the Year Finalists
2019 Best in Class 401(k) Plans
Systematic Income
The Best of Both Worlds
Plan Defense
Picture Yourself
PLANSPONSOR - February/March 2019 - C1
PLANSPONSOR - February/March 2019 - FC1
PLANSPONSOR - February/March 2019 - FC2
PLANSPONSOR - February/March 2019 - C2
PLANSPONSOR - February/March 2019 - 1
PLANSPONSOR - February/March 2019 - 2
PLANSPONSOR - February/March 2019 - 3
PLANSPONSOR - February/March 2019 - 4
PLANSPONSOR - February/March 2019 - 5
PLANSPONSOR - February/March 2019 - 6
PLANSPONSOR - February/March 2019 - 7
PLANSPONSOR - February/March 2019 - 8
PLANSPONSOR - February/March 2019 - 9
PLANSPONSOR - February/March 2019 - 10
PLANSPONSOR - February/March 2019 - 11
PLANSPONSOR - February/March 2019 - 12
PLANSPONSOR - February/March 2019 - 13
PLANSPONSOR - February/March 2019 - 14
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PLANSPONSOR - February/March 2019 - 18
PLANSPONSOR - February/March 2019 - 19
PLANSPONSOR - February/March 2019 - 20
PLANSPONSOR - February/March 2019 - 21
PLANSPONSOR - February/March 2019 - Asset Consolidation
PLANSPONSOR - February/March 2019 - 23
PLANSPONSOR - February/March 2019 - 24
PLANSPONSOR - February/March 2019 - 25
PLANSPONSOR - February/March 2019 - 2019 Plan Sponsor of the Year Finalists
PLANSPONSOR - February/March 2019 - 27
PLANSPONSOR - February/March 2019 - 28
PLANSPONSOR - February/March 2019 - 29
PLANSPONSOR - February/March 2019 - 30
PLANSPONSOR - February/March 2019 - 31
PLANSPONSOR - February/March 2019 - 32
PLANSPONSOR - February/March 2019 - 33
PLANSPONSOR - February/March 2019 - 34
PLANSPONSOR - February/March 2019 - 35
PLANSPONSOR - February/March 2019 - 36
PLANSPONSOR - February/March 2019 - 37
PLANSPONSOR - February/March 2019 - 38
PLANSPONSOR - February/March 2019 - 39
PLANSPONSOR - February/March 2019 - 40
PLANSPONSOR - February/March 2019 - 41
PLANSPONSOR - February/March 2019 - 2019 Best in Class 401(k) Plans
PLANSPONSOR - February/March 2019 - 43
PLANSPONSOR - February/March 2019 - 44
PLANSPONSOR - February/March 2019 - 45
PLANSPONSOR - February/March 2019 - 46
PLANSPONSOR - February/March 2019 - 47
PLANSPONSOR - February/March 2019 - 48
PLANSPONSOR - February/March 2019 - 49
PLANSPONSOR - February/March 2019 - 50
PLANSPONSOR - February/March 2019 - 51
PLANSPONSOR - February/March 2019 - 52
PLANSPONSOR - February/March 2019 - 53
PLANSPONSOR - February/March 2019 - Systematic Income
PLANSPONSOR - February/March 2019 - 55
PLANSPONSOR - February/March 2019 - The Best of Both Worlds
PLANSPONSOR - February/March 2019 - 57
PLANSPONSOR - February/March 2019 - Plan Defense
PLANSPONSOR - February/March 2019 - 59
PLANSPONSOR - February/March 2019 - Picture Yourself
PLANSPONSOR - February/March 2019 - 61
PLANSPONSOR - February/March 2019 - 62
PLANSPONSOR - February/March 2019 - 63
PLANSPONSOR - February/March 2019 - 64
PLANSPONSOR - February/March 2019 - C3
PLANSPONSOR - February/March 2019 - C4
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