Northern Trust Offers New Collective Trust Products

Northern Trust has launched a new investment fund platform that will consist of a series of collective funds sub-advised by investment managers retained and overseen by Northern Trust.

The Northern Trust Company Sub-Advised Collective Funds Trust will provide access to the U.S. private and public retirement market, the company said. Each collective fund will be marketed and distributed by its respective sub-adviser.

The offering will be supported through the Global Fund Services unit (GFS), which services more than 430 investment managers around the globe encompassing approximately 4,000 funds. As trustee of the funds, Northern Trust will provide due diligence review of all sub-advisers as well as transparent reporting to plan sponsors and recordkeepers.      

The company noted that collective trust funds typically have a lower cost structure than mutual funds, making them an attractive alternative for plan sponsors with fiduciary responsibility.      

“Collective trust funds are increasingly seen as an attractive vehicle for investment options offered in defined-contribution and 401(k) retirement plans, due to their potential for greater pricing flexibility and other advantages,” said Peter Cherecwich, head of Global Fund Services-North America and chief operating officer for Corporate & Institutional Services at Northern Trust, in a news release.