Affiliate Russell Wermers and Analysis Group Coauthors Discuss the Evaluation of Target Date Fund Performance in the Journal of Investment Management

February 13, 2026

Target date funds (TDFs) are professionally managed portfolios that provide dynamic asset allocation and asset management, typically with the goal of reducing risk exposure as investors approach retirement. TDFs play a pivotal role in US retirement plans, accounting for more than one-third of 401(k) plan assets. TDFs have also attracted substantial assets from investors in other types of accounts, with total TDF assets exceeding $4 trillion. 

In an article published in the Journal of Investment Management, Analysis Group Managing Principal D. Lee Heavner, Vice Presidents Ahmer Nabi and Katie Williams, and affiliate Russell Wermers overview the strategies and structures of TDFs, discuss the heterogeneity across TDFs, and provide a framework to guide the evaluation of the quality and performance of TDFs. The paper identifies several considerations that may inform investors’ fund evaluation, including the fund’s historical performance, qualitative aspects of the fund manager’s experience and research capabilities, and the choice of benchmark to which the fund is compared. The authors explain that an evaluation of TDFs should assess both the TDF’s investment strategy and glide path, as well as fund characteristics that could impact the fund’s likelihood of producing the desired risk level and expected return.

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