TRW Automotive 401k Plan PSDS Scan 12-31-2014

In this scan the Sharpe ratio for the stable value fund, FMIP, is set equal to 1.0 which avoids problems discussed in "Stable Value Funds: Performance to Date" by David Babble and Miguel Herce. That paper is the most detailed investigation of stable value funds remarkable market performance since their inception in 1973 and well worth a read.  The issue is "variance is an inadequate measure of either security or portfolio risk" and that can distort asset allocation in a PSDS scan.