Ameriprise Retirement is readying a series of target-maturity funds for use in its defined contribution product. The eight new funds will each invest in proprietary RiverSource funds and set an asset allocation based on a specific date in the future. Before now, the plan provider and fund manager had offered a series of non-registered commingled funds under the Horizon brand to its defined contribution clients looking for this type of asset allocation product.

RiverSource, which is the fund management arm of Ameriprise, filed registration statements for the funds last month.

Ameriprise Retirement's Todd Wold told the 401kWire that RiverSource hopes to launch the funds in the second quarter. He added that the funds will not be "typical" target maturity funds and that the funds will push TMFs into the next generation, but declined to provide more details before they are approved by the SEC.

Wold added that the new funds will be offered both directly to plan sponsors and through advisors to individual investors. The funds will carry Y shares for institutional investors and A class shares for the advisor channel. The load will be waived for purchases of $1 million or more. Expenses for the funds will be capped at 49 basis points.

The eight funds carry target maturity dates running from 2010 to 2045 at five year intervals. Each of the funds will invest in a mix of eight underlying RiverSource mutual funds (Disciplined Equity, Disciplined International, Disciplined Small and Mid-Cap Equity, High-Yield Bond, Emerging Market Bond, Global Bond, Core Bond and Cash Management).

Two of the underlying funds -- Disciplined International, Disciplined Small and Mid-Cap Equity -- are also new additions to the RiverSource fund family. RiverSource's Disciplined Equity and Asset Allocation team based in Cambridge will handle the strategic and tactical allocation for the funds as well as manage the underlying equity funds. The fixed income portion of the portfolios is managed by RiverSource's fixed income team in Minneapolis.  

Edited by: Sean Hanna, Editor in Chief


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