The target-date glide path: How does it work?

November 01, 2012
 
 

A conversation with John Ameriks of Vanguard Investment Counseling and Research

Vanguard target-date investments automatically shift their asset mixes of stocks and bonds to more conservative postures as the investor's target date approaches by following a "glide path." Find out what the glide path is and how it works.

Notes:

  • All investing is subject to risk. Diversification does not ensure a profit or protect against a loss in a declining market. Investments in bond funds are subject to interest rate, credit, and inflation risk.
  • While U.S. Treasury or government agency securities provide substantial protection against credit risk, they do not protect investors against price changes due to changing interest rates. While the market values of government securities are not guaranteed and may fluctuate, these securities are guaranteed as to the timely payment of principal and interest.
  • Foreign investing involves additional risks including currency fluctuations and potential uncertainty.

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