Balancing on the Life Cycle: Target-Date Funds Need Better Diversification
指出传统生命周期策略的五个缺陷，如本土偏好和通胀敏感性，并利用百年数据证明采用现代投资技术（如杠杆）能显著改善历史表现，对目标日期基金投资者和财富管理者有参考价值。
Traditional life–cycle strategies have some serious shortcomings. In this article, the authors focus on five of those weaknesses: home bias, inflation sensitivity, concentrated risk, sensitivity to episodes of equity market turbulence, and a lack of highly diversifying alternative strategies. Some of these shortcomings, such as home bias, are easier to fix than others, which may require getting comfortable with financial tools like leverage. Using over 100 years of data, the authors show that embracing financial innovation and addressing these shortcomings could have meaningfully improved historical performance. As life-cycle funds become a bigger part of the investment landscape, the authors argue that it’s becoming increasingly important to utilize more modern investment techniques—many of which have long been part of the institutional investing arsenal. <b>TOPICS:</b>Mutual funds/passive investing/indexing, wealth management