A press release said Folio(k) is a 401(k) platform offering transparency, customization, simplicity, and low cost. The platform is a turn-key 401(k) solution – including custody, trading, recordkeeping, and administration – and is available for a fee of 95 basis points.
Plan sponsors and their advisers can make their primary investment choices from a set of various risk-adjustable, Target Date Folios – pre-designed portfolios of Exchange-Traded Funds (ETFs). According to the announcement, the Target Date Folios reflect a far broader level of diversification than traditional target-date funds, investing in international equities, commodities, and TIPS, in addition to traditional domestic equities and fixed income.
The Target Date Folios are created with varying risk levels, including conservative, moderate, and aggressive.
Advisers may periodically rebalance account holdings and have the option of using Folio(k)’s updated model portfolio data as a resource. They can rebalance, add or delete securities, or change the weightings across all accounts with one click. An entire basket of securities can be traded in one transaction with no commissions, transaction fees, or ticket charges.
Fees covering all trading, custody, recordkeeping, compliance, and administrative functions total just 70 basis points, and with the addition of the ETF expense ratios, the total cost is less than 1 percent of plan assets (approximately 95 basis points). The announcement said the low-cost structure allows advisers to add an appropriate management fee and still offer a bundled 401(k) solution at a highly competitive price.
ABG Carolinas is providing all administration and recordkeeping for Folio(k). The program operates 100% online. Participant enrollment, statements, investment requests, employer reports, and materials are all delivered over the Internet.