T. Rowe Price was criticized for making a “stupid” bet in 2020 when it supercharged target date funds with equities just as the pandemic market crashed.
But the move seems brilliant today – as it was bold four years ago.
The S&P 500 is now trading at an all-time record – up about 66% – and the firm has kept its target-date portfolios up to 98% allocated. That’s several percentage points higher than other Big-Five target producers.
T. Rowe now ranks third in TDFs behind fund giants Fidelity and Vanguard, which dwarf it in assets, according to Cerulli data. [See chart below]