T. Rowe Price Announces Fee Reductions on TDFs and TrustsT. Rowe Price Group Inc. has announced that it will reduce expenses across its suite of target-date mutual funds and trusts. T. Rowe Price also filed a new series of target-date funds (TDF) for registration with the Securities and Exchange Commission (SEC) and has launched a marketing campaign to promote how target-date solutions can help investors meet their retirement goals.
The company filed prospectus supplements with the SEC to lower fees on its existing target-date portfolios. The expense reductions vary depending on the specific product type and vintage. Overall, the resulting asset-weighted average fee reduction, based upon assets under management (AUM) as of March 31, is 6.3 basis points (bps) across mutual funds and 4.8 bps across trusts.
The expense reductions follow the firm’s establishment last April of a new unitary fee structure for all target-date mutual funds, in which an all-inclusive management fee rate was set at the top level. As part of that restructuring, fees were reduced across the Retirement I Funds: I Class, Target Funds, and Retirement Income 2020 Fund.
The unitary fee structure for the target-date mutual funds will remain in place and will reflect the updated fees beginning July 1. This top-down fee structure has enabled the firm to lower TDF fees without making underlying fund or allocation changes.
The overall investment approach and benchmarks for the retirement and target series remain unchanged. The new Retirement Blend Fund series is expected to be available publicly on or about July 28 and will offer Investor Class and I Class shares across all vintages, from 2005 to 2065.
ICMA-RC Details New Updates to Its Managed Accounts Platform
As part of ICMA-RC’s transition to MissionSquare Retirement, the company has announced updates to its managed accounts platform. Powered by Morningstar Investment Management, Guided Pathways Advisory Services offers investment assistance for participants.
The advice platform that powers Guided Pathways Advisory Services provides a more personalized and intuitive user experience. Features include recommendations customized to participants’ retirement and financial goals on when they’re able to retire, how to invest their accounts and how to withdraw money in retirement.
New features include: A digital experience that offers participants the ability to take a do-it-yourself approach or work with a knowledgeable financial consultant; a new Social Security guidance tool that helps participants decide when to start receiving Social Security benefits; and portfolio customization through an enhanced methodology from Morningstar Investment Management that further customizes participants’ recommended investment portfolios.
Northern Trust Updates Workflow Tool
Northern Trust has launched the next iteration of its Rec Dashboard, a workflow tool that provides real-time view of breaks and reconciliations in trade activity between asset managers and other institutions.
Rec Dashboard is hosted within Omnium, a Northern Trust middle- and back-office technology platform for fund administration. To optimize communication and collaboration between the manager and fund administration teams as breaks are reconciled, Rec Dashboard provides Omnium users with data visualization capabilities and more direct views into reconciliations. The enhanced tool is available to asset managers globally who use the Omnium platform.
“We are always seeking ways to better collaborate with clients, and Rec Dashboard allows us to work closely with them as our teams manage an essential daily process,” says Jeff Boyd, chief executive officer of Northern Trust Hedge Fund Services. “Clients benefit from deeper insight into our processes, a more intuitive user experience and heightened productivity for their own operations.”
Putnam Investments Releases Actively Managed ETFs
Putnam Investments has debuted its first actively managed exchange-traded funds (ETFs), based on four of the firm’s leading equity strategies. The new ETFs—Putnam Sustainable Leaders ETF (PLDR), Putnam Sustainable Future ETF (PFUT), Putnam Focused Large Cap Growth ETF (PGRO) and Putnam Focused Large Cap Value ETF (PVAL)—have begun trading on the New York Stock Exchange.
The new offerings represent the first ETF products from the company, which currently provides an array of retail mutual funds, separately managed accounts, collective investment trusts (CITs), private funds and non-U.S. funds.
“We are excited to enter the ETF marketplace today with the launch of active ETFs that employ Putnam’s time-tested, active management expertise,” says Robert L. Reynolds, president and chief executive officer, Putnam Investments. “The introduction of these four ETFs delivers on our longstanding commitment to meet the evolving needs of investors by offering a broad range of vehicle options that access our deep, fundamentally driven investment capabilities.”
The new active ETFs have underlying investment portfolios similar to existing Putnam mutual fund and separately managed account strategies, and they use the same portfolio managers and research teams as those related products.
Putnam’s suite of ETFs will use the Fidelity tracking basket methodology for active equity ETFs. Fidelity’s tracking basket methodology and related features are designed to provide market makers with enough information to make effective markets in shares of the ETFs while also maintaining the confidentiality of portfolio holdings necessary for Putnam to execute these strategies for the benefit of investors.
Cuna Mutual Group Launches Model Portfolio Program
Cuna Mutual Group has launch YourTarget Portfolios, a new model portfolio program offering plan sponsors and advisers the ability to build custom-designed plans through the company’s Total Retirement Solutions platform.
YourTarget Portfolios is an open architecture program that allows plans of all sizes to structure portfolios that are more personalized than traditional target-date funds (TDFs). The program offers multi-manager, age and risk-based portfolios from an open architecture investment universe across both active and passive strategies to optimize plan design and more precisely serve the individual circumstances of plan participants.
“We believe that flexibility is crucial for retirement plan success, and with the thousands of portfolio construction possibilities available, YourTarget Portfolios gives plan sponsors and advisers the freedom to create that for the participants they know best,” says Paul Swanson, vice president, retirement, Cuna Mutual Group.
YourTarget Portfolios also offers fiduciary protection and support through Envestnet Retirement Solutions (ERS), which features the option to delegate the role of custom portfolio design to a provided Employee Retirement Income Security Act (ERISA) 3(38) fiduciary investment manager to develop, monitor and update portfolios on an ongoing basis. Program users can still choose to work with another 3(38) investment manager or manage their own portfolios as a 3(38) investment manager, as well.
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