Addition of TD Greystone Target Date Plus Funds to the Core investment platform

Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the funds listed below, which are established as segregated funds in accordance with the Insurance Companies Act (Canada).

Sun Life Group Retirement Services (GRS) is pleased to announce the addition of the TD Greystone Target Date Plus Series of Segregated Funds (the Funds) to our DC Core investment platform (Core platform). The Funds will be available beginning March 1, 2023. 

We are adding the Funds to provide plan sponsors and their members with additional choice in the important Target Date category.

About the TD Greystone Target Date Plus Funds  

TD Greystone created the funds in 2014 and the series currently consists of nine funds that range in target maturity from 2025 to 2060, in 5-year increments, and a retirement fund. The Funds are a unique offering on the Core platform, due to their significant allocation to private (non-listed) alternative asset classes. The Funds each invest 20-25% in alternatives, which consist of Canadian and global real estate, global infrastructure and commercial mortgages. This allocation to private alternatives provides additional diversification and comes with unique opportunities and risks. Other target date funds available on the Core platform offer smaller allocations to alternatives that consist primarily of listed securities (i.e. real and infrastructure stocks).    

The Funds’ objective is to deliver strong long-term returns along with reduced return volatility as their maturity date approaches. To reduce return volatility, as the maturity date nears investments in risker assets (i.e., equities) will decrease, while investments in lower risk assets (i.e., fixed income) will increase. Primary investments include: i) equity, ii) bonds, iii) global & Canadian real estate, iv) infrastructure, and v) commercial mortgages.  

The Fund series’ glidepath balances market risk with timing (also known as sequence of returns risk) that a plan member faces as they approach retirement. This glidepath shape reduces equity exposure in the funds earlier than most other target date series. TD Greystone believe that the exposure to alternative investments allows this earlier de-risking. The 2065 fund vintage has an asset allocation of approximately 72% equity, 5% fixed Income and 23% alternatives. At maturity, the asset allocation is 41% equity, 34% fixed Income and 25% alternatives.  The glidepath does not change after maturity.

TD Greystone is a part of TD Asset Management (TDAM). A four-person Institutional Active Asset Allocation team (IAAAT) manages the funds. They are part of the TDAM Asset Allocation team. 41 investment professionals focus on allocation research, strategy, synthetics and portfolio management make up the broader team. 

IAAAT are responsible for designing strategic asset mix, fund selection and tactical asset allocation. They do this for TDAM’s active balanced funds, and custom fund-of-fund solutions for institutional investors. The IAAAT team members collaborate amongst themselves as well as the broader Asset Allocation team. This collaboration is embedded through all aspects of the team’s investment process.

The Funds currently invest in 15 underlying funds, all managed in-house. The underlying funds are primarily actively managed. The following are the permitted asset allocation ranges for all Funds in the series.

The Funds’ Statement of Investment Policies and Procedures (SIPP) are available on the plan sponsor website.  

Below is an illustration of the glidepath.