January 27, 2010

Principal enters diversified retirement income space

Ok, with so much needed in the retirement income space, we'll bite on Prinicpal Funds' latest announcement.

With a one year trak record behind it, the Principal Global Diversified Income Fund seeks cash income through a diversified, yield-focused investment strategy.

"By 2014, it is projected that more money will flow out of qualified retirement plans than into them because of retiring Baby Boomers*," said Mike Finnegan, Principal Funds chief investment officer and portfolio advisor of the Principal Global Diversified Income Fund. "For financial professionals and their clients the discussion is shifting from accumulation of assets to converting their savings into a stable income stream that is designed to last a lifetime."

The Principal Global Diversified Income Fund is designed to complement more traditional yield-producing investments with specialized asset classes. The fund uses a multi-manager, multi-disciplined approach and active rebalancing.

Asset classes and target allocations in the fund include:

  • High-yield bonds - 35 percent
  • Preferred securities - 20 percent
  • Global real estate securities - 15 percent
  • Master limited partnerships (MLPs) - 10 percent
  • Global value equity - 10 percent
  • Emerging markets debt - 10 percent

New white paper for financial professionals available

A new Principal Funds white paper written for financial professionals examines diversified yield strategies and the impact of a global diversified income portfolio in a traditional portfolio. The paper, "Retirement Income Strategies--Why Diversification Matters," is available at www.principalfunds.com/diversifiedretirementincome.

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