Investors and retirement plan fiduciaries want greater returns from their target-date funds, but it is important to know what the risks are.
That's the word from James Lauder, portfolio manager and CEO of Global Index Advisors Inc., in talking about what he calls return-envy — when retirement plan participants or fiduciaries make decisions based on greed or fear.
"For fiduciaries, it can make them make decisions that aren't in the best interest of their plan, that don't really marry to their philosophy of what they're trying to accomplish for the individual participants. And, for investors, it can lead them to make those self-defeating kinds of decisions that have very negative effects on their long-term retirement-saving success," Lauder said last week in Wells Fargo's "On the Trading Desk" podcast.
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