Research, analysis, and thoughts on retirement investments & the future of personalization
In our exploration of “what is a glide path” we touched on their basic premise: to represent asset allocation over time for a Target Date Fund (TDF). Traditionally, when viewing a single glide path, the vertical (Y) axis represents equity exposure and, at times, can show a stacked area chart of overall asset allocation.
Target Date Funds' “yellow brick road” is their glide path. The glide path is, in essence, a pre-described mix of the TDFs asset allocation over time. Since the advent of TDFs, it has been universally accepted that the longer a participant's time horizon, the more risk they should accept via higher equity exposure.