Deals & People June 13, 2008

Fidelity Taps Wilens for Head of Asset Management

Fidelity Investments turned to Thomson Reuters executive Michael E. Wilens to fill the new position of head of asset management.
Reported by

Fidelity President Rodger A. Lawson said in a news release that Wilens will oversee Fidelity Management & Research Company (FMRCo), Pyramis Global Advisors, and Strategic Advisers. Among his responsibilities, Wilens will provide management oversight to the asset management groups, work with fund trustees and direct the firm’s investment technology and operations areas, Fidelity said.

Wilens will join Fidelity in mid-July and be a member of the firm’s Executive Committee.

Never miss a story — sign up for PLANADVISER newsletters to keep up on the latest retirement plan adviser news.

“For some time now, we have been looking for an exceptional executive to provide cohesive oversight of Fidelity’s three major investment divisions,” said Lawson, to whom Wilens will report. “As the range of investment products and services offered by these groups grows more diverse, we need a highly experienced business leader who can offer in-depth management expertise and guidance to the executives directly in charge of our investment experts.”

Fidelity has $3.3 trillion in assets under custody, including $1.5 trillion in managed assets.

The firm recently brought aboard CEO Robert Reynolds (see Fidelity Alum Reynolds to Lead Putnam Investments and New Putnam CEO Has “Winning’ On His Mind), and hired two new portfolio managers (see Putnam Takes on Portfolio Managers from American Century).

Data & Research June 13, 2008

Lifecycle Funds: the QDIA of Choice?

Nearly eight in 10 (78%) employers surveyed by Fidelity Investments already offer a QDIA, with most (63%) holding lifecycle funds as the QDIA.
Reported by

In addition, 14% of employers indicated they plan on switching to one of the qualified default investment alternative ( QDIAs) sanctioned in Department of Labor (DoL) regulation, and of those, 87% said they will use a lifecycle fund, according to a Fidelity press release. The QDIA regulation provides a fiduciary liability safe harbor for employers that choose lifecycle funds, a balanced fund, or managed accounts as the investment to which participant dollars are defaulted in the absence of an investment election.

The DoL’s regulation was the biggest factor in driving employers to change default options (53%), followed by their concern for their employees’ ability to be retirement ready (27%), the survey found.

For more stories like this, sign up for the PLANADVISERdash daily newsletter.

Among Fidelity’s recordkeeping clients, half of defined contribution plans currently have a lifecycle option as a default—representing nearly 70% of Fidelity’s participant base—compared to just 8% in 2005. More than 4.8 million Fidelity participants now have some portion of their workplace retirement assets invested in a lifecycle option, up from 2.3 million participants in 2005.

The use of stable value and money market accounts as a default has decreased to less than half (49%) of DC plans—26% of Fidelity’s participant base—from 88% of DC plans holding them in 2005.

Scott B. David, president of Retirement Services at Fidelity Investments said in the release that lifecycle funds are becoming the default investment of choice not only because of the DoL’s fiduciary protection, but also because it relieves the challenge for employees of choosing the right asset mix.

«