Agenda (as of April 9, 2012)
Subject to change
7:30 - 8:30 am
Registration and Breakfast
8:30 – 8:45 am
Speaker: Lori Lucas
Executive Vice President, DC Practice LeaderCallan Associates
PRESENTATION: No More Inmates Running the Asylum: The Role of Professional Management in DC Plans
The role of professionally managed solutions in DC plans is growing and evolving. At one time, a 60%/40% balanced fund was the extent of professional management in such plans. Now DC plan sponsors are increasingly exploring and embracing everything from professionally managed individual accounts to income solutions in retirement. Plan sponsors' views of one professionally managed solution--target date funds--are becoming more discerning and sophisticated. We'll explore--using case studies and empirical data--the latest trends in professionally managed solutions, including selection, adoption and monitoring
9:15 – 9:55 am
WORKSHOP: Target Date Portfolios: Solving for a Variety of Participant Risks
When saving for retirement, participants inevitably experience a variety of risks— longevity risk, market risk, implementation risk, and the risk of inflation, to name a few. With target-date portfolios—which are designed to be a participant’s primary retirement investment vehicle—it’s imperative that investment managers construct portfolios that are both robust and flexible enough to address these risks. This session will examine the primary risks inherent to retirement investing and demonstrate how a robust asset allocation strategy can help to mitigate the risks for participants.
9:55 – 10:40 am
PANEL DISCUSSION: Defining Success for Your 401(k) Plan
When it comes to knowing whether your 401(k) plan is working, what criteria should you use? There are plenty of benchmarks, with plan participation a key one. But should plan sponsors focus on the investment performance and the success of the retirement funds, rather than focusing on the (necessary) accumulation markers? This panel will discuss the various ways that plan sponsors measure success – and the successful retirements of their participants.
10:40 - 11:00 am
11:00 – 11:40 am
WORKSHOP: Target Date Funds and Managed Accounts in the DC Lineup: Enhancing Participant Diversification
This workshop will compare the distinct roles of target date funds and a managed account advisory service in a defined contribution plan investment line-up. The presentation analyzes the types of participants drawn to each strategy, and evaluates their effectiveness in improving diversification of participant portfolios. Offering both forms of advice in a plan lineup can meet the needs of a diverse participant population.
11:40 am – 12:20 pm
WORKSHOP Thoughtful Alternatives Exposure for DC Participants
The majority of investment exposure within defined contribution plan core menus and default options remains limited to developed market equity and US fixed income. At the same time, many niche asset classes have become more mainstream and unlike defined contribution plans, defined benefit plans have capitalized on these new options. This workshop will show you a thoughtful approach to introducing alternative asset classes to your defined contribution plan and the benefits it might have for employees.
12:20 – 1:30 pm
1:30 – 2:10 pm
PRESENTATION: The Investor's Worst Enemy (SAN FRANCISCO & DALLAS)
Professor Odean will discuss his research on how psychological biases and decision heuristics affect the trading and welfare of individual investors. Analyzing the trading records of hundreds of thousands of investors, Professor Odean finds that individual investors tend to trade too frequently, hold on to their losing investments, and buy stocks that are in the news. Mutual fund investors pay too much attention to past returns and too little expenses. And asset-pricing bubbles are more likely when investors are happy and excited. Finally, many brokerage ads portray a distorted picture of the investment process.
Speaker: Professor Terrence Odean
Rudd Family Foundation Professor of Finance
Haas School of Business
The University of California, Berkeley
PRESENTATION: The Psychology of Decision Making: Implications for 401(k) choices (CHICAGO)
Individuals spend each day making and avoiding making decisions. Fifty years of research has documented that we tend to use rules of thumb or heuristics to deal with the ambiguities and complex tradeoffs involving in making choices. In this talk, Professor Wu will discuss a few highlights of this research on the psychology of decision making, including how gains and losses are thought of differently, and how choice conflict leads individuals to avoid making decisions. The presentation will finish by discussing some of the implications of this work for 401(k) choices.
Speaker: George Wu
Professor of Behavioral Science
University of Chicago Booth School of Business
PRESENTATION: These Aren't the Droids You're Looking For: Jedi Mind Tricks for Influencing 401(k) Choices (NEW YORK)
401(k) choices are surprisingly malleable. This presentation will discuss new evidence on how inserting just one or two sentences in an email to 401(k) participants can create dramatic shifts in the 401(k) elections they subsequently choose. You will learn how to craft your own communications to leverage these psychological phenomena and achieve the results you desire.
Speaker: James J. Choi
Assistant Professor of Finance
Yale School of Management
2:10 – 2:50 pm
WORKSHOP: Substance Over Style – An Objectives-Based Approach to DC investing
The common approach to DC investment menu design is to first identify broad asset classes, such as equity or fixed income, and then select style specific investments to populate these asset classes. Most participants struggle to make appropriate choices, and this often leads to sub-optimal results. An alternative approach is to redefine the investment menu by participant objective, such as growth or inflation protection, and then let these objectives define the investment mix. This workshop will introduce an objectives-based approach to DC investing and walk attendees through a case study.
2:50 – 3:35 pm
PANEL DISCUSSION: Considering the Move to Passive Investment Lineups
It’s a trend that many have identified in the wake of the 2008 financial crisis. Many 401(k) plan investment lineups are moving to offering fewer funds at the second tier level and the ones that are being removed are often those that involve active management. Is there a place for active fund management in the lineup? Or does the move to passive accurately reflect the mood among both plan participants and sponsors? This panel discussion will consider the building blocks of the optimal plan lineup.
3:35 – 3:55 pm
3:55 – 4:35 pm
WORKSHOP: Engaging the Younger Employee in DC Plan Participation
Type the phrase ‘retirement readiness’ into your favorite search engine and it will return a tsunami of articles, calculators and surveys that provide sobering statistics from around the globe showing how unprepared workers are in planning and saving for retirement. In particular, the younger age cohort is commonly identified as the group with the highest at-risk percentages of not having sufficient retirement income. With DC plans likely to serve as the primary retirement investment vehicle for those below the age of 35, it is critical to encourage this segment of the workforce to participate in DC plans early, consistently, and intelligently. This age cohort has not historically been given special focus, but the need to take meaningful steps towards improving their financial positioning is highly warranted. This workshop will discuss how this age group can benefit from higher quality participation, examine challenges and propose ideas and tactics for plan sponsors in achieving this objective.
4:35 – 5:20 pm
PANEL DISCUSSION: The Retirement Income Conundrum
With some notable first movers adding full-scale retirement income solutions to their DC plans, has the time come for others to consider in-plan choices? This panel discussion will consider various approaches to the end game: retirement. After all, many people have retired out of DC plans, so although the development of retirement income solutions is welcome, it may not be the answer for all plan sponsors. What are the considerations and what are the options when it comes to providing choice for your plan participants as they reach retirement?
5:20 – 6:30 pm
Closing Cocktail Reception