Fidelity Investments last Thursday announced the launch of its Variable Insurance Product Freedom Funds, a series of seven lifecycle "funds-of-funds" that help investors choose an asset allocation strategy based on their stage in life and their expected retirement date.

The move comes at a time when the nearly $77 billion in assets under management by lifecycle mutual funds are rising at a fervent pace due to increasing demand. The VIP Freedom Fund Portfolios--VIP Freedom Income Portfolio, VIP Freedom 2005, VIP Freedom 2010, VIP Freedom 2015, VIP Freedom 2020, VIP Freedom 2025, and VIP Freedom 2030--are among the first insurance-dedicated lifecycle portfolios. They will be offered as part of insurance companies' variable insurance products.

Co-managed by Ren Y. Cheng and Christopher L. Sharpe, the VIP portfolios will be gradually adjusted to become more conservative for investors as they near retirement. Upon reaching its target date, each portfolio will close and merge into VIP Freedom Income Portfolio.

"With more than $1.2 billion in assets, the Fidelity Advisor Freedom Funds have become an increasingly popular investment choice among advisers since they were launched only 18 months ago," said William Loehning, executive vice president, Fidelity Investments Institutional Services Co.

"Working with insurance companies across the country, we saw a real opportunity to help insurers add significant value to their insurance product line-up by offering a series of portfolios that can deliver appropriate diversification and are managed to meet specific investment time horizons."

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