The closer you get toward your retirement date, the higher the ratio of bonds in your portfolio, earning their name of a retirement plan on autopilot. Simon Maierhofer for ETF Guide reports that XShares and TD Ameritrade teamed up and created five TDAX Independence Funds, which he explores in light of the recent market turmoil. Do they follow their objectives?

Combined, they boast $150 million in assets.

• TDX Independence In-Target (TDX): The most conservative fund; 3% of the fund’s assets are allocated to international equities, 8% to domestic equities and 89% to fixed income.

• TDX Independence 2010 (TDD): This fund is designed for investors who plan to retire around 2010. 8% of the fund’s assets are allocated to international equities, 24% to domestic equities and 68% to fixed income. The allocation to equities is adjusted downward to 11% in the year 2010.

• TDX Independence 2020 (TDH): This fund is designed for investors who plan to retire around 2020. 17% of the fund’s assets are allocated to international equities, 49% to domestic equities and 34% to fixed income. After 2020, 11% is allocated to equities.

• TDX Independence 2030 (TDN): This fund is designed for investors who plan to retire around 2030. 22% of the fund’s assets are allocated to international equities, 65% to domestic equities and 13% to fixed income. After 2030, 11% toward equities is adjusted.

• TDX Independence 2040 (TDV): 24% of the fund’s assets are allocated to international equities, 72% to domestic equities and 4% to fixed income. The allocation to equities is adjusted downward to 11% in the year 2040.

The In-Target ETF has certainly provided a place to have parked your money. TDX is down 4.6% year-to-date. The 2010 portfolio is down about 15.3%, which given the general market conditions is acceptable. The 2020 portfolio dropped by 25.5%, the 2030 and 2040 portfolios have lost about 32.3% and 34.2%, respectively.

It’s up to investors to ultimately decide if that performance works for them, and whether these kinds of funds are a fit in their portfolios.

The TDAX exchange traded funds (ETFs) has changed their name. The new name is TDX Independence Funds, effective immediately. Their ticker symbols, as listed on NYSE Arca, will remain the same.

A life-cycle ETF operates under the same asset allocation formula that assumes the investor will retire at a specific, pre-determined date, which is identified in the title of the fund. Over time, the portfolio’s asset allocation becomes more conservative over time so that they stay in line with their objective. These types of funds have other applications, too, such as to save money for a wedding or college.

The ETFs will be known thusly as:

• TDX Independence 2010 (TDD), down 5.6% year-to-date
• TDX Independence 2020 (TDH), down 9.7% year-to-date
• TDX Independence 2030 (TDN), down 12.4% year-to-date
• TDX Independence 2040 (TDV), down 14.3% year-to-date
• TDX Independence In-Target (TDX), up 0.4% year-to-date