Asset allocation funds benefit participants; Study shows 401(k) performance shines for those who let others make decisions.

Pensions & Investments, March, 2006 by Gottlieb, Jenna

Byline: Jenna Gottlieb NEW YORK - 401(k) plan participants that invest in balanced or asset allocation funds are more consistent in outperforming the market, and those that use more investment options achieve higher returns. These surprising conclusions came from a new report by ING Investment Management, New York.

In what firm officials said is the largest study ever done on DC participant investment returns, ING analyzed data on 600,000 individuals from 321 plans over the five years ended Dec. 31, 2004. The plans are all record-keeping clients of JPMorgan Retirement Services, Kansas City, Mo. Participants using balanced or asset allocation funds in their portfolios, about one-third of the group, were much more consistent in outperforming the S&P 500...

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