Voya Target Retirement Funds Achieve Positive Returns in Q3 2025

The Voya Target Retirement Funds reported positive performance in the third quarter of 2025, driven by a rally in U.S. markets. This surge was fueled by strong earnings from U.S. companies, optimism surrounding artificial intelligence advancements, and interest rate cuts from the U.S. Federal Reserve. While the funds surpassed their strategic allocation benchmarks in terms of gross returns, they fell short when considering net returns after fees.

Market Dynamics and Fund Performance

In the third quarter, small-cap and growth stocks led the market rally, contributing to the positive performance of the Voya Target Retirement Funds. According to Voya, the funds achieved both absolute and relative returns that outperformed their strategic allocation benchmarks. The shift in market sentiment was influenced by a significant decrease in inflation, with the core Personal Consumption Expenditures Price Index (PCE) dropping from a peak of 5.6% in 2022 to a 12-month average of 2.8%.

This moderation in inflation has been crucial for investors, as it signals a more stable economic environment. The U.S. Federal Reserve’s decision to cut interest rates also provided a favorable backdrop for equities, encouraging investment in riskier assets.

Investment Strategy and Long-Term Goals

The Voya Target Retirement Fund Series is specifically crafted to align with the changing risk-return profiles of participants as they progress towards retirement. The objective is to maximize the likelihood of achieving a successful retirement while managing risks effectively.

By employing tactical asset allocation, Voya aims to adapt to market conditions and enhance returns over the long term. The funds are designed to adjust their investment strategies in response to market fluctuations, thereby optimizing performance for investors at different stages of their retirement journey.

Overall, the positive results from the Voya Target Retirement Funds in Q3 2025 reflect a successful strategy amidst a recovering market. Investors can take confidence in the fund’s ability to navigate through shifting economic landscapes, while the focus on achieving long-term retirement goals remains a priority.