Vanguard to pay more than $100 million to SEC over violations involving target date retirement funds

[mahatmakanejeeves]

MARKETS
Vanguard to pay more than $100 million to SEC over violations involving target date retirement funds

PUBLISHED FRI, JAN 17 2025 12:24 PM EST
UPDATED FRI, JAN 17 2025 3:54 PM EST

Jesse Pound
@JESSERPOUND
@/IN/JESSE-POUND

Darla Mercado, CFP®
@DARLA_MERCADO

KEY POINTS
• The alleged violations stem from a 2020 change where Vanguard lowered the minimum investment requirement for its institutional target date funds.
• The payment of $106.41 million will be distributed to harmed investors, the SEC said. Vanguard agreed without admitting or denying the SEC's findings.
• Vanguard is one of the world's largest asset managers, reporting more than $10 trillion of global assets as of November.

{snip}

[yourout]

1. I'm guessing that will disappear in a few days.

[bucolic_frolic]

2. If indexing is the best return you can expect, why have Target Date funds??

Yeah, I know. % of bonds is the target date idea. Stay safe. 4% is the best you can do.

Most actively managed funds lag indexing. But some do better. Most large cap funds own the same Magnificent 7 stocks. So do tech funds, USA funds, growth funds, quant funds. This is not diversification. It's concentration. Read annual reports. Look at the fund managers, where they went to school, how they pursue alpha. Some fund companies do nothing but contract out for fund managers and you never find out about them. It's not investing. It's warehousing. Your money.