While equity markets were strong in the last quarter of 2013, target-date funds didn't return as much as the S&P 500, in large part because of poor performance in non-U.S. equities and bonds, according to a report by Ibbotson Associates.
Target-date funds returned an average 5.4 percent for the fourth quarter, which was significantly less than the 10.5 percent return of the S&P 500. TDFs usually include a mixture of both equity and fixed income.
The average total return for target-date funds for 2013 was 16.3 percent, which was about half the return of the S&P 500 Index.
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