P&I Online users believe target-date funds are the best place for alternative investments in defined contribution plans.
Pensions & Investments asked the question, “Where do alternatives fit into a DC plan?” because liquid alternatives are becoming more common as managers increasingly offer alternatives strategies as mutual funds. Managers cite the growth of defined contribution plans as one of the impetuses for the growth of liquid alternatives.
“There's such a strong green-field opportunity right now. Retail investors, including defined contribution plan investors, don't have enough alternatives in their portfolios,” said Evan Mizrachy, the San Francisco-based head of retail alternatives for BlackRock Alternative Investments.
Readers were almost twice as likely to select target-date funds over the second most popular answer, core funds. See the results below:
- Target-date funds: 40.5%
- Core funds: 22.5%
- Brokerage window: 20%
- Alts do not belong in DC plans: 17%