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Administration September 28, 2009
DC Plans Increasingly Use Investment Consultants
September 28, 2009 (PLANSPONSOR.com) - According to
the third quarter issue of The Cerulli Edge - Retirement
Edition, 41% of defined contribution assets are currently
controlled by consultants, with the majority of these assets
in large plans over $500 million in assets.
Reported by Rebecca Moore
Cerulli anticipates this figure should continue to increase as plan sponsors look to augment the fiduciary skill associated with their plans, and demand best-of-breed managers and custom target-date funds. According to the report, there has been a continued shift by consultants of client assets into alternatives and long-duration fixed income, as over three-quarters of consultants said they desire a consistent investment performance track record and no surprises.
In a press release, Cerulli said institutional investment consultants have become a critical avenue for asset managers hoping to distribute through a 401(k) platform. The report suggests asset managers should develop the role of the portfolio specialist, as consultants respond positively to this role, and only 57% of consultants feel access to a portfolio manager is very important.
“By understanding how investment consultants operate and
effectively meeting their demands, managers can be best
poised to take part in custom target-date funds and
open-architecture DC platforms,” Cerulli said.
The report can be purchased from
www.cerulli.com
.