Bonds: Total Market
State Street Global Advisors has launched a new series of target date funds—called the Target Retirement IndexPlus Strategy—that includes a 10% allocation to private markets managed by Apollo.
These funds, structured as collective investment trusts (CITs), pair State Street’s index strategies for public markets with Apollo’s evergreen fund providing exposure to private credit, equity, and real assets. Brendan Curran of State Street likens this evolution to shifting into a new gear in retirement investing, acknowledging the growing significance of private assets in diversified portfolios.
The collaboration follows earlier efforts between State Street and Apollo, including the launch of a private credit ETF. Apollo views this as part of its broader push to tap into the wealth management space and expand access to private investments, aiming to grow its assets in this segment to $150 billion by 2029.
Finsum: The launch reflects a broader trend of asset managers integrating private markets into retirement solutions to meet demand for diversification and improved outcomes.
Closed-end funds (CEFs) can be valuable additions to a diversified portfolio, offering the potential for capital growth and income through both investment performance and regular distributions.
Unlike open-end mutual funds, CEFs typically provide higher distribution rates, often paid monthly or quarterly, and allow reinvestment that may enhance long-term returns. Their fixed-share structure after IPOs means managers aren’t forced to hold cash for redemptions, allowing for more efficient and fully invested portfolios.
CEFs also give investors exposure to the illiquidity premium by enabling access to less liquid, potentially higher-yielding investments that open-end funds often avoid.
Finsum: Many CEFs may use leverage to try to boost returns, though this adds risk and volatility.
Target-date funds offer a hands-off approach to retirement investing by automatically adjusting asset allocations over time. These funds balance growth and security by shifting from stock-heavy portfolios in early years to safer investments like bonds as retirement nears.
Named for the investor’s target retirement year, these funds simplify decision-making and are commonly found in employer-sponsored 401(k) plans. A key factor in choosing one is its “glide path,” which determines whether asset adjustments stop at retirement or continue for years beyond.
While convenient, investors should compare expense ratios and investment strategies to ensure alignment with their risk tolerance. Three TDF funds to consider are:
- Vanguard Target Retirement 2045 Fund Investor Shares (VTIVX) – Expense Ratio: 0.08%
- Fidelity Freedom Index 2045 Fund Investor Class (FIOFX) – Expense Ratio: 0.12%
- T. Rowe Price Retirement 2045 Fund (TRRKX) – Expense Ratio: 0.62%
Finsum: Despite their “set it and forget it” appeal, periodic reviews help maintain a well-balanced portfolio.
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Deeper tax planning integration in wealth management can enhance advisors’ ability to deliver proactive tax strategies that go beyond traditional investment management. Tax planning has become a crucial differentiator in modern wealth management, with more investors seeking advisors who can optimize after-tax returns and long-term financial outcomes.
Strategies like Roth conversions, tax-loss harvesting, and asset location are now essential tools for high-net-worth clients navigating an increasingly complex tax landscape. With concerns about rising tax rates and policy risks, forward-looking tax planning is becoming indispensable for preserving and growing client wealth.
Advisors who incorporate these strategies can build deeper client relationships, attract more assets, and position themselves competitively in an evolving industry.
Finsum: Tax strategies help give advisors an edge when dealing with clients and helping them allocate to efficient portfolios.
JP Morgan Asset Management is gearing up to introduce its first private credit interval fund, aiming to expand its footprint in private credit. This newly registered credit markets fund, filed with the SEC, will be accessible to wealth market investors.
The fund plans to maintain a diversified portfolio that includes loans, bonds, structured finance securities, and other credit-related investments. Interval funds, like this one, provide access to private market assets with periodic liquidity windows, balancing stability with limited redemption opportunities.
To manage liquidity, a portion of assets will be allocated to short-term debt instruments, money market funds, and cash reserves.
FINSUM: As investor demand for private credit grows, asset managers are increasingly tailoring products to individual investors seeking diversification.
Cryptocurrencies tumbled as concerns over a broader U.S. stock selloff overshadowed recent efforts by President Trump to support the industry. Bitcoin dropped more than 3% in early Asian trading, while Ether sank as much as 6% to its lowest level since October 2023 before recovering some losses.
The decline followed a sharp selloff in technology stocks, with the Nasdaq 100 plunging 3.8%, its worst session since October 2022. Despite Trump’s executive order to establish a U.S. Bitcoin reserve, investor sentiment remained fragile as macroeconomic risks took center stage.
Analysts noted that leveraged crypto-related ETFs were among the hardest hit, with some plunging more than 30% in a single day. While Bitcoin hovered around $79,300, traders were eyeing key support levels at $73,000 and $70,000, where stronger buying interest could emerge.
Finsum: While many think of crypto as hedge against market volatility, we need to remember that those hedges are a little effective on the currency side.