Products October 26, 2010

AAG to Provide Guidance, Advice to MetLife Plans

MetLife Resources entered into a partnership with Advised Assets Group, LLC (AAG), a registered investment adviser that delivers investment advisory services to defined contribution plan sponsors and plan participants.
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According to a news release, AAG will offer its guidance and advisory services, the Triple Solutions Program, to qualified retirement and 403(b) plans sponsored by non-profit organizations for which MetLife Resources provides administrative services. Ibbotson Associates, Inc., AAG’s independent financial expert, provides the methodology for the Triple Solutions Program.

“The program features a flexible suite of services to accommodate a variety of needs, allowing plan sponsors to provide different levels of advice to plan participants to invest for retirement,” said Thomas G. Hogan, Jr., senior vice president and head of MetLife Resources.

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The Triple Solutions Program offers a choice of three levels of advisory support, tools and personalized investment help. These levels vary by participant behavior type and feature graduated levels of assistance.

The levels of service include, according to the news release: 

  • Online Guidance — This level of service offers participants access to online investment guidance, including asset allocation and retirement savings rate recommendations. Participants select their investments and manage their own plan account portfolio.
  • Online Advice — In addition to the assistance offered with the Online Guidance service level, this level of service features specific investment recommendations based on the participant’s plan’s funding choices. Participants choose their investment options and oversee the management of their plan account portfolio.
  • Managed Accounts — In addition to retirement readiness monitoring, participants receive a personalized, professionally-constructed portfolio based on their individual situation, which is then monitored and managed regularly on their behalf.

All service levels include post-retirement features, including recommendations for investing and spending during retirement, the news release said.

In addition to addressing asset allocation and investment concerns among participants, AAG acts as a fiduciary for the Managed Accounts and Online Advice services.

The Markets October 26, 2010

Target-Date Funds See Positive Q310

As a result of a Q310 turnaround in equity returns, as well as continued positive performance in the fixed-income market, target maturity funds strolled into the fourth quarter on a positive note, according to a Morningstar report.
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For the quarter, the average target maturity fund returned just over 10%, slightly less than the 11.3% of the S&P 500 Index but significantly above the 2.5% of the BarCap U.S. Aggregate Bond Index. The weighted average return of the 13 indexes that collectively form the Morningstar Lifetime Moderate Index family fell between the target maturity fund average and the S&P 500 index with a 10.8% return.

These strong returns were especially welcome after the second quarter when the funds and indexes declined more than 7% on average, Morningstar said. For the 12-month period ending September 30, 2010, performance for each metric was similarly strong, falling between 9.3% and 10.4%.

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Although all asset class returns were positive during this period, those funds with higher allocations to equities, particularly to non-U.S. developed equities, commodities, and real estate tended to be the top performers.

The returns for all of the indexes in the Morningstar Lifetime Allocation Index family were positive over the past three months, with even the most conservative indexes having returns above 4% while the most aggressive topped a 13% return, Morningstar said.

Over the past year, the range of returns was tighter with the most conservative indexes returning just less than 8% and the most aggressive indexes returning just over 11%. The top two performing equity asset classes this quarter were emerging markets equity and non-U.S. developed equity as the dollar weakened, supporting non-dollar denominated assets. Within fixed income, all asset classes were positive as well (both the third quarter return and 12-month standard deviation were slightly higher than 0% for cash but show as 0.0% due to rounding).

The 12-month returns for all asset classes were also in positive territory. REITs continued to be the biggest winner over this period with a stellar 30% return, while emerging markets equity was also a top performer with more than a 20% gain.

Within the United States, growth outperformed value and small cap outperformed large cap during this time. High-yield bonds continue to perform similar to equities.

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