NEW YORK, NY September 6, 2016 – Goldman Sachs Asset Management (“GSAM”) today announced the launch of a new series of target date retirement funds. As part of their long-term strategy to provide clients with a full range of retirement investment solutions, GSAM is offering a suite of eight target date mutual funds in 5-year increments ranging from retirement years 2020 to 2055.
GSAM has re-entered the target date space via the adoption of the Madison Target Retirement Funds, four target date funds whose track records date back to 2007, from Madison Asset Management, LLC (Madison) a target date manager with deep asset allocation expertise and a strong history of producing competitive returns. By combining Madison’s track record with GSAM’s distribution capabilities, GSAM seeks to deliver a differentiated solution primed to meet today’s fiduciary challenges and retirement investor needs.
“Consultants, advisors and plan sponsors are re-examining their process for evaluating target date funds following guidance from the Department of Labor,” said David A. Solomon, National Sales Manager for Defined Contribution Investment Only at GSAM. “Understanding and managing conflicts of interest has become top of mind for plan sponsors. The Goldman Sachs Target Date Portfolios seek to provide an objective approach to defining the universe of underlying funds used in portfolio design and other unique features we believe sponsors will value to address today’s fiduciary challenges.”
The series has two distinct features that GSAM believes sets it apart from a competitive field:
- The open architecture approach to investment selection provides a broader opportunity set which is not limited to affiliated funds. This may be attractive to sponsors who are concerned with managing conflicts of interest and avoiding manager concentration.
- Active asset allocation allows the investment team to reflect current market views using a tactical allocation range around the glide path to help manage market volatility and longevity risk over the long-term investment horizon.
The GS target date fund glide path is managed “to retirement” with a more conservative allocation to equities compared to the Morningstar industry average for target date funds1. The team is focused on the participant experience and seeks to deliver a more predictable outcome to retirement investors.
“Investors seek simple and professionally managed solutions to help them achieve their retirement goals,” said Rachel Schnoll, Head of Product Strategy at GSAM. “Our partnership with Madison allows us to enhance our DC fund line-up with a target date series with the attributes today’s investors are seeking.”
GSAM strengthened the series by launching four additional target date funds on the 5-year vintages. GSAM will be the investment advisor and retain Madison as the sub-advisor to the funds. David Hottmann and Patrick Ryan have been managing the original Madison series since 2009 and will continue on as co-portfolio managers.
