A stable value fund is an insured bond portfolio, popular with investors that have low risk tolerances. Stable value funds are a common option in some retirement plans such as company 401(k) plans, especially aimed at those savers nearing retirement. The PLUS Fund is a stable value fund. Fund Profiles. Many ICMA-RC participants have access to a stable value fund in their retirement plan.1 You may not have heard much about this type of investment prior to joining your retirement plan because it's not available in IRAs or taxable brokerage accounts. The bonds in such a fund are sometimes called "wrapped" bonds, referring to the fact that they are insured. RC Services is a wholly-owned subsidiary of ICMA-RC … A stable value fund is inherently as safe an investment as a money market fund. A money market fund is a type of mutual fund that invests in high-quality, short-term debt instruments and cash equivalents. Like their money … The Prudential Guaranteed Long term fund, which accounts for approximately 33% of the overall Stable Value … The use of insurance wrappers to create a stable net asset value … Currently, the average stable-value fund yields 3%, while the average taxable money fund yields … But, to dampen volatility, they may keep a portion of their portfolio in a stable value fund or other more-conservative option. Stable value funds can provide portfolio diversification and help mitigate some of the downside risk in your overall portfolio. A pension plan is a retirement plan that requires an employer to make contributions into a pool of funds set aside for a worker's future benefit. Technical Guidance. Income funds pursue current income over capital appreciation by investing in stocks that pay dividends, bonds and other income-generating securities. In conjunction with TRS, we underwent a rigorous due diligence … The current funds reporting into Stable Value Vision are shown below. The investment options for the Commonwealth of Virginia 457 Plan are organized into three pathways to make it easier for you to implement your investment decisions according to your knowledge of investments and investment style. 1A stable value fund may not be available in all retirement plans. Fund Category Stable Value/Cash Management Bond Balanced/Asset Allocation U.S. Stock International/Global Stock ... ICMA-RC Services, LLC is a wholly owned broker-dealer subsidiary of ICMA-RC and member FINRA/SIPC. Stable Value Fund or Common Collective Trust Many defined contribution plans obtain beneficial ownership interests in bank or collective trust funds, allowing several smaller unaffiliated plans to gain the economies of scale necessary to participate in the stable value … By using Investopedia, you accept our. Stable Value Fund. Fixed income refers to assets and securities that bear fixed cash flows for investors, such as fixed rate interest or dividends. They are designed to protect … While stable-value funds can return more than a money-market fund, annuity-like stable value funds also put a cap on the fund’s upside. Investors should be aware that all investments, including money-market funds and stable value funds, have unique risks and no investment should be considered risk-free. A stable value fund provides a conservative investment option with lower risk than fixed income and equity securities. However, there is a danger if a portfolio is weighted too heavily in lower-yielding investments such as stable value funds. Money-market funds have returned barely more than 0 percent over the past several years, while stable value funds have generally returned 1.5 percent to 2.5 percent. Stable value funds tend to pay higher interest rates than cash equivalent options, such as money-market funds, because they invest in slightly longer-term, but not long-term, fixed income securities. A … The insurance is commonly issued in the form of a so-called synthetic guaranteed investment certificate (GIC). Copyright © ICMA-RC document.write(new Date().getFullYear()), VantageCare Retirement Health Savings (RHS), VantageCare Retirement Health Savings (RHS) Program, Center for State & Local Govenment Excellence, ICMA-RC Customer Relationship Summary for Retail Investors (Form CRS), Center for State and Local Government Excellence, Overview of Disaster Recovery and Business Continuity Plans, We join you in an unwavering commitment to delivering high-quality services and innovative resources to help public sector employees Engage, Build, and RealizeRetirement. Stable value investments seek to provide relatively stable income that is comparable to shorter- to intermediate-term bonds over time but with preservation of capital. Contact ICMA-RC … Stable Value Pooled Funds (Pooled Funds): ... (DCIO) team, the Funds are offered by ICMA-RC Services, LLC (RC Services), an SEC registered broker-dealer and FINRA member firm. How Floating Rate Funds Can Offer Yields in a Rising Rate Market, The Benefits and Risks of Fixed Income Products. Stable value funds tend to pay higher interest rates than cash equivalent … The Fidelity Stable Value pools are separate funds of the Fidelity Group Trust for Employee Benefit Plans and managed by Fidelity Management Trust Company. While many other investments drop in value, the owner of a stable bond fund continues to receive the agreed-upon interest payments and never loses principal regardless of the state of the economy. As the name implies, stable value funds are a type of cash fund that resembles a money market fund by offering protection of principal while paying stable rates of interest. 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