BOSTON (Reuters) - For three years, the mutual funds in Fidelity's flagship retirement franchise have outperformed at least 85 percent of their competitors, reversing a decade-long trend of subpar performance.
And yet client money has continued to flow out of the firm's Freedom Funds as retirement plan sponsors shift workers’ savings to rivals in the target-date fund business.
While deposits in the trillion-dollar sector have surged, Fidelity has seen nearly $16 billion in net withdrawals over the past four years, according to research firm Morningstar Inc.
The exodus stems in part from unease with the way Boston-based Fidelity has boosted performance - by ramping up risk.
Since a strategy overhaul that took full effect in 2014, Fidelity has substantially increased exposure to stocks, including those from volatile emerging markets. The firm also scrapped a long-held belief of sticking to pre-set allocations of stocks, bonds and other assets in target-date funds. https://www.yahoo.com/finance/news/special-report-fidelity-puts-6-120852578.html
Submitted March 05, 2018 at 03:35PM by bobbyw24 http://ift.tt/2Fi8DQ3
