Northern Trust has launched a new collective funds trust that will be subadvised by investment managers retained and overseen by the Chicago-based financial holding company, confirmed Northern Trust spokesman John O’Connell.
Each collective fund will be distributed and marketed by its respective subadviser.
“There’s a lot of interest in this type of product,” Paul d’Ouville, global head of product management for Northern Trust’s asset servicing business, said in a telephone interview. He did not discuss the kinds of collective trusts that will be offered.
Mr. d’Ouville noted that about half of defined contribution plans offer collective trusts, which typically have a lower cost structure than mutual funds.
He said that in addition to offering the collective funds trust platform, managers working through Northern Trust also will be able to take advantage of the company’s transfer agency, fund accounting, fund administration and global custody services.