Nationwide Target Destination Funds and Rebalancing
Each Nationwide Target Destination Fund invests in a mix of different asset classes that is tailored to your estimated retirement date--the date closest to the target date designated in the Fund's name. Your retirement date is the date when you reach the approximate age of 65 years (or, in the case of the Nationwide Retirement Income Fund, the approximate age of 85 years). The target date is the approximate date when you may choose to retire and/or begin withdrawing from the Fund.
The principal value of each Nationwide Target Destination Fund is not guaranteed at any time, including at the target date designated in the Fund's name. Over time, the Fund's allocations to different asset classes will become more conservative, with greater emphasis on investments that provide for income and preservation of capital, and less on those offering the potential for growth.
A glide path illustrates the way assets are allocated in a Fund in the years approaching your retirement. Some companies design their products' glide paths to stop rebalancing a fund's portfolio when the investor reaches his or her retirement date. At Nationwide Funds, our glide path keeps rebalancing the Fund's portfolio up to and 20 years beyond the start of your retirement, to help protect against inflation and longevity risk. See how the allocations inside our Nationwide Target Destination Funds will change throughout the years with our Glide Path tool.
Investing in mutual funds involves risk, including the possible loss of principal Investors' shares, when redeemed, may be worth more or less than their original cost.
Important Disclosures
The Nationwide Target Destination Funds are designed to provide diversification across a variety of asset classes, primarily by investing in underlying funds. Therefore, in addition to the expenses of the Nationwide Target Destination Funds, each investor is indirectly paying a proportionate share of the applicable fees and expenses of the underlying funds.
In general, a fund with a later target date is expected to be more volatile, and thus riskier, because of its greater allocation to equity securities than a fund with an earlier target date. A fund at its target date through the next 20 years is expected to be less volatile than a fund in its “pre-target-date” stage. The Nationwide Retirement Income Fund, which is the vehicle intended to serve investors who are approximately 20 years beyond a fund's target date, is expected to be the least volatile of the Funds due to the Retirement Income Fund's further reduced exposure to equity securities.
Asset allocation is the process of spreading assets across several different investment styles and asset classes. The purpose is to potentially reduce long-term risk and capture potential profits across various asset classes.
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