Northern Trust Asset Management today announced its Goal Engineer Series of target date managed accounts, launched in response to increased demand for robust solutions for individual retirement accounts. The series of seven portfolios provides solutions for investors who are either building for their life in retirement or managing their savings during retirement.
“We recognize saving as early as possible and effectively managing funds in retirement are fundamental challenges of retirement investing,” said Melinda Mecca, managing director of Managed Account Solutions at Northern Trust Asset Management. “Goal Engineer is a simple, effective, low-cost solution that is designed to help financial advisors help their clients invest smarter and smoother, and take the right risks at the right time.”
The Goal Engineer Series uses a diversified asset allocation framework and Northern Trust’s investment glidepath, which aims to minimize the effects of market volatility by automatically adjusting the investment mix from more aggressive to more conservative as the target date draws near. The disciplined, multi-asset class approach includes innovative factor-based equity strategies, traditional active fixed income investments and inflation-sensitive securities.
The growth component of Goal Engineer portfolios uses Engineered Equity™, Northern Trust’s targeted equity exposure strategy that includes such factors as value, low volatility, quality and size, and systematically combines the best of active and passive management. Through equity factor exposures, this method can provide greater consistency, less risk and added transparency, as well as the potential for higher returns with less risk compared to traditional equity indexing. The income portion of the glidepath is delivered through Northern Trust’s active fixed income strategies, and the inflation-sensitive investments include commodities, global real estate and Treasury Inflation-Protected Securities (TIPS).
“Our new generation of managed accounts is designed to better align portfolio composition with an investor’s time horizon until retirement and expected lifespan in retirement,” said Northern Trust Chief Investment Officer Bob Browne. “In short, Goal Engineer portfolios are designed to build better outcomes by managing market, inflation and longevity risk.”
Unlike traditional target date funds in which all the asset classes are contained within one fund, Goal Engineer is a Separately Managed Account investing in Northern Trust products to gain multi-asset class exposure. This structure provides enhanced transparency into the asset allocation. Additionally, it provides flexibility in the event investment objectives change in the future,
“We expect that regulatory changes will increase advisor demand for effective individual retirement account solutions, said Mecca. “To meet this demand, the Goal Engineer Series builds on Northern Trust’s long-standing heritage as a trusted investment management institution by delivering a cost-efficient solution for advisors and investors.”
Goal Engineer is available to individual investors through registered investment advisors.