What is an asset allocation fund?

2nd Dec 2009 by Daniel Cross, ChFC

An Asset Allocation Fund is where money allocation between fixed income and stock investments are altered as the fund progresses to it's announced retirement date. For example: An asset allocation fund with a retirement date of 2035 will begin with investments primarily in equities. As the fund approaches 2035, the percentage invested in equities is slowly reduced and placed into fixed income. These funds have gained in popularity and are now offered through almost every retirement plan and provides a sort of "one-stop shopping" for investors.

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