DCALTA Partners with PivotalPath to Launch Hedge Fund Benchmarks for 401(k) Plan Sponsors
- Partnership moves the industry further towards providing American retirement savers with more tools and data to secure better retirement outcomes
- The tremendous growth in defined contribution plan assets (~$10 trillion) coupled with massive contributions to target date funds requires the need for quality and transparent benchmarks
- Plan fiduciaries, consultants and participants will now have a series of meaningful hedge fund benchmarks to better evaluate hedge fund manager risk and performance
Feb 01, 2022, 16:07 ET
NEW YORK, Feb. 1, 2022 /PRNewswire/ -- Consistent with its mission of enhancing retirement outcomes, DCALTA (the Defined Contribution Alternatives Association) has partnered with PivotalPath, a leading hedge fund consultant and analytics company to release a series of nine hedge fund indices for defined contribution plans, such as 401(k), 457(b) and 403(b) retirement plans.
As a collective voice, DCALTA believes that alternative investments such as hedge funds, private equity and infrastructure will become common allocations within defined contribution portfolios, as they commonly exist in defined benefit pensions and endowments. "With the ever-increasing adoption of target date funds and near $10 trillion in defined contribution plans, there clearly exists a need for plan fiduciaries to rely on proper performance benchmarks. For fiduciaries trying to accurately assess hedge fund market performance, the collection of consistent and quality data is paramount," says Jonathan Epstein – DCALTA President and Founder.
"We are excited and proud to partner with PivotalPath on our first set of retirement indices focused on multiple hedge fund strategies, as well as a comprehensive hedge fund market composite. "Simply put, the defined contribution plan industry needs quality benchmarks, and this has been a strategic initiative of ours since 2015," says Michelle Rappa, Managing Director at Neuberger Berman and DCALTA Executive Committee Member. DCALTA will be releasing a series of indices to help plan sponsors, consultants and others better assess market net-of-fee performance and volatility.
"As a hedge fund consultant working with institutional investors, it is critical for our clients to accurately benchmark their hedge fund portfolios - something that has been quite difficult historically with available indices. Our clients rely on our indices because the information we provide ultimately determines their overall hedge fund asset allocation, and whether or not they invest in or redeem from a manager." says Jon Caplis, CEO of PivotalPath.
In partnership with DCALTA, and through transparency, PivotalPath will help the defined contribution community confidently benchmark their hedge funds by being able to answer the following four critical questions: 1) What goes into the index, 2) What is the methodology used to construct it, 3) How is the information presented and 4) Is there is more to the index than the average.
Learn more by reading PivotalPath's latest article on this subject: What's in Your Index?
DCALTA seeks to enhance the retirement security of defined contribution (DC) plan participants by the inclusion of alternative assets through 1) A modest allocation within a long term focused multi-asset fund option on a DC plan menu, 2) A well-diversified portfolio of alternative assets, and 3) Professionally managed within a prudent structure designed for the needs of DC plan participants. DCALTA's mission includes education, research and advocacy on the benefits and alternative investments options within a defined contribution framework. To learn more about DCALTA, please visit dcalta.org.
PivotalPath is a leading hedge fund consultant and analytics company. Our philosophy is based on a simple question: how can allocators make good hedge fund investment decisions if they don't know all of the relevant choices? We build the most robust peer groups and indices, so our clients not only know their full set of options, but have the transparency and tools to evaluate, benchmark and monitor their hedge funds in the right context. We cover over 2,400 institutional quality hedge funds across 40 strategies comprising ~$2.5 tr in global hedge fund capital. Institutional investors leverage our platforms and perspective to supplement their manager research, benchmarks, and allocation process. PivotalPath's clients consist of pensions, endowments, foundations, RIAs, and family offices
SOURCE DCALTA - Defined Contribution Alternatives Association
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