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Collective investment trusts gain in popularity for target-date funds

A decades worth of high-profile claims under the Employee Retirement Income Security Act have sparked demand for target-date funds in the form of collective investment trusts.

By Nick Thornton | Updated on June 07, 2016
A decade’s worth of high-profile claims under the Employee Retirement Income Security Act have sparked demand for target date funds in the form of collective investment trusts. (Photo: iStock)

In the past two years, four providers of target-date funds have started collective investment trust versions of life cycle strategies to complement traditional mutual fund offerings.

The largest target date fund (TDF) providers continue to strongly favor the mutual fund form of TDFs over the collective investment trust form, as one-third of the providers only offer TDFs through a mutual fund vehicle, according to Portfolio Evaluations Inc., a Warren, N.J.-based consultancy that benchmarks investments for retirement plans.

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Nick Thornton

Nick Thornton

Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.

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