Riding a rising trend, in 2025 about 60% of employee retirement plan participants are invested in single fund Target Date Funds, and nearly 59% of individual IRA investors have chosen them as well.
Why the popularity? It’s all about fear and simplicity.
First the Simplicity
Target Date Funds take your planned retirement date into account and automatically adjust your mix of equities and bonds as you approach retirement—so your portfolio evolves without you having to lift a finger.
And then there’s the Fear
As retirement draws closer, the fear grows—what if one ugly market year wipes out everything you’ve worked for? This fear leads many investors to retreat to the popularity and perceived safety of Target Date Funds.
To protect themselves, most investors pull back hard, sliding from aggressive to conservative to ultra-conservative allocations.
The catch?
Playing it too safe too soon means missing out on the growth you still need to keep from running out of funds in retirement. That’s why having a smarter signal in place is such a game-changer—it shields you when markets stumble while still keeping you in moderately aggressive investment allocations needed to capture the upside.
But are Target Date Funds really the Optimal Solution?
Up until now, they have been an OK solution, but our new Subscription WavRyder Signal publication provides investors with another way to monitor their investments and allows them to Ride the Wave and Dodge the Storms of the stock market. In the process, the WavRyder Signal allows the investor to choose a more aggressive investment mix than what is found in the typical Target Date Fund because of the signal sent by email at the end of each market close.
Every day, the WavRyder Signal takes the market’s pulse and gives you one simple signal: a Red Light or Green Light. No noise. No guesswork.
If the Signal is Green - consider staying the course with your investments
If the Signal is Red - consider a shift to Cash
That’s the WavRyder Signal in a nutshell…but let’s dive a bit deeper in the numbers, using a 20-year stock market back-test…
20-Year Backtest: Comparing Typical Target Date Fund Growth vs. The WavRyder Signal Alternative
WavRyder Signals | Almost $1M more growth at a lower risk profile
A tale of two portfolios:
Target Date Fund Composition: 70% Equities / 30% Bonds
WavRyder Signal Portfolio Composition: 33% S&P 500, 33% Dow Jones Industrial Average, 34% Nasdaq (with the added safety valve in that this portfolio is adjusted to move to cash when the WavRyder Signal so indicates)
The numbers in the chart above speak for themselves: in a 20-year back-test, a $400,000 investment in a WavRyder-adjusted fund outperformed a traditional Target Date Fund by almost $1 million—thanks to the power of the WavRyder Signal.
The WavRyder Signal adjusted portfolio outperformed by allowing the investor to invest in a more aggressive investment mix knowing that the WavRyder Signal would highlight times to be cautious - to shift to the safety of Cash.
The WavRyder Difference | Ride the Wave…Dodge the Storms
Here is 20-year comparison of annual returns of both the standard Target Date Fund (10 years away from retirement) and a simple combination of the three major index ETFs (one-third invested in each of the Dow, Nasdaq and the S&P 500 index exchange traded funds (ETFs).
WavRyder | Protects on the way down, profits on the way up.
The WavRyder Signal offers a smarter alternative to Target Date Funds, allowing you to pursue a more aggressive investment mix while protecting your portfolio from steep market downturns by moving to cash when it detects a storm brewing.
How?
The WavRyder Signal rides the wave of the market when it is flourishing and steps aside when it’s not.
While traditional Target Date Funds ride every wave—up or down—WavRyder Signals takes a smarter approach. Its algorithm, grounded in 60 years of market history, signals when conditions are favorable and when it’s time to step aside.
Clear and Straightforward: No need for a PhD to decode complex charts or levers—the Signal shows up as an easy-to-read red or green light at the close of each trading day.
WavRyder Signal | Simple to Understand and Act Upon
The Signal cuts through the noise with a single, easy-to-read and interpret Red or Green light after each day’s close
WavRyder Signal Adjusted Broad Market Indices vs. the Traditional Target Date Fund
The WavRyder Signal in Action –
Fund 1 – Tracks the Nasdaq, enhanced by the WavRyder Signal adjustments.
Fund 2 – Tracks the S&P 500, enhanced by the WavRyder Signal adjustments.
Fund 3 – Tracks the Dow Jones, enhanced by the WavRyder Signal adjustments.
Fund 4 – A balanced mix: one-third of each index fund from above, all powered by the daily WavRyder Signal.
Full WavRyder Model - The full ETF rotation model that generates the WavRyder Signal.
The result after a 20-year back-test? Four easy choices - all favorable to the very conservative Target Date Fund.
The WavRyder Signal lets you invest in more aggressive funds than the conservative Target Date Fund, capturing greater gains when markets rise while shifting to safety to limit losses when markets fall.
The WavRyder Signal provides powerful downside protection, reducing the severity of losses when compared to a traditional Target Date Fund.
The true value of the WavRyder Signal is that it allows the luxury of pursuing a more aggressive investment mix without the fear of taking a massive single year hit when the market heads into a downturn.