J.P. Morgan rolls out online evaluation tool for target date funds

J.P. Morgan Funds is rolling out an online version of its target date evaluation program for financial advisers. The firm also is discussing developing a similar tool to help advisers analyze target risk funds. With the new tool, advisers can get an analysis of target date funds' various asset allocations, the number of asset classes represented and which funds fit best with a specific 401(k) plan, said David Musto, head of J.P. Morgan's retail-investment-only retirement business. “We have narrowed it down to five different questions an adviser and their clients can ask to determine which of the target date types make the more sense,” he said. Although J.P. Morgan last year introduced a target date fund evaluation tool — Target Date Compass — to advisers directly through its representatives, the online tool also lets advisers access archived reports and more-in-depth analysis, Mr. Musto said. An online tool will make it easier for advisers to help plan sponsors understand the differences among the various funds, said Michael Mosse, president of retirement services at Mosse & Mosse Associates, a registered investment adviser with $1 billion in assets under management. “This is the first tool that helps us explain the difference in target date funds and why one 2010 fund might [have lost] 30% in 2008 and another might [have lost] 8%,” he said. After conducting a pilot program with the tool for the past month, J.P. Morgan Funds is now rolling it out to all adviser clients, Mr. Musto said. It is considering a similar tool to accommodate advisers and plan sponsors who prefer target risk funds as their default options, he said. “A certain segment of the plan sponsor community has viewed risk-based funds as more acceptable as a qualified-default-investment alternative,” he said. “We think there is an application there.” E-mail Jessica Toonkel Marquez at [email protected].