The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we're going to be talking about why target date funds are a scam and I want to explain the reasoning behind that. The reason that I say target date funds are a scam is because what target date funds do in theory sounds rational and logical. They’re going to basically rebalance your portfolio on an ongoing basis as you approach some target date, potentially retirement, potentially the end of your employment of some target date in the future. For example, when my wife was a teacher and signed up for her benefits package, one of the things that the person who was suggesting benefits for her said, “You need to put yourself into one of these target date funds because you’re going to be retiring in 30 years, so when you retire in 30 years, (or 20 years, whatever it was) you’re going to want a different mix in your portfolio.” And again, this sounds logical and reasonable that that would happen. Her target date fund wo