AKF Blog


we have a lot of thoughts about the 529 industry. Important topics like downward fee trends, program manager rebids, new product developments, and even the Veep’s Task Force, to name just a few. We have our bird’s eye view and we want to share it with you.

So we invite you to follow us on Twitter – 529Source – and to visit this blog frequently. We’ll tell you what we’re thinking and we hope you’ll tell us, too. We need to elevate the college savings conversation – across states, program managers and advisors alike. That’s what we intend to do. Please join us. Read Now>

  • Morningstar’s Pick of Best International Equity Fund ManagersJanuary 10, 2014

    Morningstar has nominated another set of five fund managers for the International Stock Fund Category. Two of the nominated fund managers’ funds are used in 529 Plans: the Dodge & Cox International Stock Fund (DODFX) and the Causeway International Value Fund (CIVVX). The Dodge & Cox Fund is present in three 529 Plans including Illinois Bright Directions (10 options), Indiana Direct (1 option) and South Dakota Advisor (1 option). The fund returned 26.3% in 2013.

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  • Morningstar’s Pick of Best Domestic Equity Fund ManagersJanuary 09, 2014

    Morningstar has nominated five fund managers for the Domestic Stock Fund Category, two of which manage funds in 529 Plans. One of them is the Dodge & Cox Investment Policy Committee which manages the Dodge & Cox Stock Fund (DODGX). The fund returned 40.55% in 2013 and is included only in the Nebraska NEST Advisor Plan (6 options). The second fund manager is Larry Puglia, who manages the T. Rowe Price Blue Chip Growth Fund (TRBCX).

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  • International and US Stocks Perform WellJanuary 08, 2014

    2013 was a great year for international equity funds in general, and even better for US equity funds. According to Morningstar, the top performing international category (foreign small/mid cap growth) returned 22.6% as of December 19, which was lower than the worst performing US category (large cap value) which returned 28.3%. Declining foreign currencies and relatively better US growth are some reasons that explain the difference in returns.

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  • Overcrowding into Short Term BondsJanuary 07, 2014

    In response to an interest rate shock in the summer of 2013, many investors have directed dollars to short term bonds. Over $30 billion have flowed into the short duration category ever since, which we believe reflects investors’ concerns about a possible interest rate spike in the near future. Short maturity bonds help reduce interest rate risk in the short term, but investors need to determine whether the move makes sense from an overall portfolio standpoint. It could mean giving up upside potential and losing diversification benefits from having duration in the portfolio.

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  • Emerging Markets in 529 PlansJanuary 06, 2014

    Emerging markets, which used to be categorized as a “non-traditional” asset class, do not seem non-traditional anymore for purposes of 529 plans. The asset class is offered in 78 investment options across more than half of all 529 direct- and advisor-sold plans. Recently there has been much talk of emerging markets due to its disappointing performance in 2013, caused by the announcement of planned Fed tapering and slow growth in China and Brazil. Nonetheless, over the long-term, emerging markets has been a noticeable source of yield

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