Federated Investors (FII) launched three target maturity mutual funds, which invest primarily in exchange-traded funds.  The funds are aimed to provide a low-cost option for retirement plans, such as defined contribution plans and IRA accounts.  The funds are:

  • Federated Target ETF Fund 2015,
  • Federated Target ETF Fund 2025
  • Federated Target ETF Fund 2035. 

Investments will consist of equity, fixed income, domestic and international markets.  The funds will use a blended benchmark of S&P 1500, Lehman Aggregate Bond and MSCI-EAFE.

With this move, Federated is offering an option to investors to use ETFs in their retirement plans, as well as jumping into the fast growing ETF market.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.