Investments

There is considerable confusion on exactly what OCIO services mean. Simply put, the primary difference in OCIO versus traditional consulting services is who owns final discretion for the selection of managers/funds and the execution of investment decisions. According to the PGIM survey, the top objective for plan sponsors is very different than OCIO service provider goals. All Plan Sponsors considering the benefits of implementing this type of service should begin by identifying internal goals and priorities before conducting due diligence…

Why bring attention to a service 64% of Plan Sponsors have not evaluated yet? As the Great One said,  Wayne Gretzky, “I skate to where the puck is going, not where it has been.” Projections are that OCIO assets will rise from $1.1 Trillion to $1.7 Trillion in the next 3 years according to Cerulli Associates. Plan Sponsors are being approached by their current advisors/ consultants or new consultant touting the OCIO or ERISA 3(38). The OCIO/ERISA 3(38) term means…

Managed Accounts All 401(k) Plan recordkeeping firms are experiencing margin compression in their core business and seeking ways to increase their revenue in other areas, such as selling Managed Accounts. It is critical that Plan Sponsors realize Managed Accounts are NOT a service but an investment product. Why the distinction? A Managed Account as an investment product means you have a fiduciary duty to conduct due diligence to evaluate the benefits. As with any fiduciary decision, it is important for…

OCIO/ERISA 3(38) As this consolidation has occurred on the advisor side, Advisor firms are actively positioning OCIO (Outsourced Chief Investment Officers), ERISA 3(38) or Discretionary Asset Management services to Plan Sponsors. The three terms are used interchangeable and relate to hiring an advisor/consultant to take fiduciary responsibility from the Retirement Committee for all investment related decisions including hiring and firing investment managers/funds in your retirement plan. Generally, Committees are utilizing this service due to: Plan Sponsors considering the implementation of…

S&P 500 Price Returns during Presidential Elections Years It’s Super Tuesday! Heading into the year, all eyes were on the upcoming Presidential Election.  Impeachment, trade disputes, and Brexit were all seemingly behind us and the only unknown on the horizon was the election.  Then along came Corona… the Virus.  Ahem. But here’s what we were thinking about before the pandemic.  Below is a chart showing the price return (return excluding dividends) of the S&P 500 Index during each Presidential Election…