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It has better diversification than the S&P500, which focuses exclusively in US stocks. I'd be going for target date 2050+ funds, which are 50% US stocks, 40% int'l stocks, and 10% bonds.
Or maybe I'm misapplying the concept of diversification?
The issue is that over the past 10 years (not including the recession before of course), the S&P has outperformed these target date funds. I'm not sure how the recession factors into this.
Target date funds tend to have very high expense ratios that will significantly into your money over the years. That would be enough for me to never use them. You can model your portfolio off of them if you wanted.
I got a Vanguard one with just 0.15% as the expense ratio, so that doesn't seem to be an issue.
It's all stock/bond index funds.
This is something I use to keep in mind about total diversification:
https://www.mymoneyblog.com/callan-periodic-table-of-investment-returns-2019.html
Personally, I like managing my own portfolio and tend to slightly outperform the index funds by using a mix of index and active funds across the spectrum. It really comes down to your comfort level vs. The ease of the all in one fund.