GAEG - NYL Anchor

Jan

Can anyone explain what exactly this fund is? I don't fully understand it.
I invested 25% of in it a couple of years ago because I was told it was one of the safest funds in my companies 401k offerings. The only other relatively semi safe funds offered are FXNAX and MWTSX. I have 25% in the former and the remaining 50% in CDs in IRA's.
I am still working at 68and will continue (knock on wood). I want to preserve what I have if possible.
Is this fund as safe as CD's?

Mark

Product Guide - New York Life Stable Value Investments

msf

Stable value funds ... “invest in both short- and intermediate-term securities and follow the traditional concept of investing where the value of money over time generates a higher yield,” notes John Faustino, chief product and strategy officer at Fi360 in Lawton, Michigan. “They tend to hold investments that are slightly less liquid and, as a result, have a higher yield. Plus, they have an insurance wrapper that protects the value of the assets should there be a fluctuation or a decrease in the assets’ value.”

https://www.plansponsor.com/in-depth/choosing-stable-value-money-market-fund/

Here, the insurer is NY LIfe.

Safety? NY Life is one of two insurers rated as highly as the US Treasury by all four major rating agencies. It would be rated even higher, except being a financial institution, S&P figures that if the Treasury collapses, it will drag NY Life down with it. (There are two non-financial companies with higher ratings than the Treasury.)

Jan

Thank you for the information! But that leads me to another question:
There are only 2 companies that have a higher rating than US Treasuries - Microsoft and J and J.
From a chart shown in the link below, MS outperformed NASDAQ by 73% and large caps by 123%.
If it is safe, why wouldn't a large percentage of investors have at least some of this stock in their portfolio?


https://www.netcials.com/stock-10-year-history/MSFT-Microsoft-Corporation/

msf

The ratings are for the companies' bonds - will these companies default on their debt? They're not analyst ratings on the value of their companies.