TDF Flows Bounce Back in Q1

Target-date funds managed by the top 10 providers in the country bounced back to post net inflows of $10.5 billion in the first quarter of 2024, according to the latest data from ISS Market Intelligence’s Simfund.

It’s the strongest quarter for TDFs since Q1 2023, when the top providers combined for $16.6 billion in net inflows. It also comes after a tough Q4 2024, when they ended with net outflows of $666 million, according to according to data provided by Simfund, which, like PLANADVISER, is owned by Institutional Shareholder Services Inc.

Quarterly flows since the start of 2023 were:

The U.S. stock market ended Q1 at an all-time high, with the S&P 500 surpassing 5,000 for the first time. April then saw the index drop below that mark, only to overtake it again in May.

The fixed income market, meanwhile, started the year with expectations of a Federal Reserve interest rate cut that never emerged; now, in part due to persistently high inflation, market watchers are waiting to see if and when the Fed can to start reducing rates.

None of the top 10 TDF providers saw outflows in Q1, though the leader board did move around.

The Vanguard Group posted the highest net new flows at $4.2 billion, outpacing Capital Group’s American Funds, which was the Q4 2023 leader, and saw inflows of $2.9 billion. BlackRock Inc. remained in the third position, the same as it ended 2023, with $1 billion in inflows.

Meanwhile, PIMCO LLC swapped places with GuideStone Capital Management LLC for the 10th and 9th spots—with PIMCO posting $109.2 billion in inflows and GuideStone showing $125.7 billion.

Flows by manager were:

Total assets among the top 10 providers landed at $1.77 trillion.