Emerging Markets ‘Clear Leader’ in Asset Class Selection

March 16, 2011 (PLANSPONSOR.com) – Some 77% of retirement plans responding to a new survey said they have emerging markets equities in their plans or are considering including them in their investment lineups.

A report about the survey by Grant Thornton LLP, Drinker Biddle & Reath LLP, and Plan Sponsor Advisors LLC labeled the emerging markets equities the “clear leader” among asset classes.

According to the study report, real estate investment options followed with 53%, global bonds 48%, TIPS 39% and socially responsive 27%, with commodities rounding out the responses at 20%.

The study cautioned sponsors to make certain whether a real estate-related investment is structured as a REIT or actually holds physical real estate. “They are two very different investment strategies and could have significant implications for your participants,” the study commented. “With investments in physical real estate, participants may be unable to access their money temporarily and may be placed in a queue with other investors waiting for their investments to be liquidated.”

The study report is at http://www.grantthornton.com/staticfiles/GTCom/Grant%20Thornton%20Thinking/Surveys/2011_Retirement-Survey_FINAL.pdf.