PAi Opens Office in South Dakota

Plan Administrators, Inc. (PAi), headquartered in Green Bay, Wisconsin, will open its second office in Sioux Falls, South Dakota, on May 5.

The office will house a customer care team providing 401(k) plan services to business owners and their employees, as well as PAi’s Trust Company. PAi Trust Company will also be located in the PAi Sioux Falls office and will serve as an operations center for PAi Trust, with day-to-day trust activities being conducted out of this location.

PAi has been in business for 30 years, and specializes in 401(k) plans from start-ups to multi-million dollar plans. PAi has developed a proprietary system that delivers simple and affordable retirement solutions.

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“We’re excited about the expansion and look forward to replicating our unique culture in South Dakota,” says Tracy Ruh, PAi’s chief operating officer. “The entire organization is passionate about helping people prepare for retirement, and that passion drives us to constantly look for new opportunities. This expansion to Sioux Falls will enhance our efforts to successfully provide 401(k) solutions nationwide.”

PAi administers 401(k) plans for more than 190,000 participants and 7,000 financial advisers, and manages more than $3 billion in retirement assets. Its focus is on offering low-cost 401(k) administration with transparent fees and easy-to-use technology. For more information about PAi, visit www.pai.com.

DB Plans to Increase Alternative Investments

New research indicates defined benefit (DB) plans will turn increasingly to alternative investments during 2014.

A recent survey of investment consultants by global analytics firm Cerulli Associates confirms that U.S. institutional investors across client segments have increased their exposure to alternative assets since 2007. Cerulli’s research indicates as institutional investors increasingly take an objective-based approach to portfolio construction, hedging and risk management allocations will grow in importance within institutions’ portfolios.

Investment consultants polled by Cerulli expect DB pensions will increase allocations to hedge funds (65% of consultants), other private investments (56% of consultants) and private equity and venture capital (50% of consultants) during the next 12 months. In addition, they anticipate nonprofits will increase their proportion of alternative investments during the next year, specifically allocations to other private investments (75% of consultants), private equity and venture capital (58% of consultants), and hedge funds (46% of consultants).

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“The 2008 financial crisis left institutions in search of more consistent portfolio returns across different economic environments,” says Michele Giuditta, associate director at the Boston-based Cerulli. “There is new thinking around portfolio construction, leading institutions to reevaluate their models for governance, asset allocation, and implementation.”

The report explains, “One challenge of a risk-based allocation is the lack of consistency among institutions’ classification methods. As this shift continues, traditional asset classes and style boxes are increasingly irrelevant. Blurring asset class boundaries typically leads to higher allocations to alternatives, as institutions seek assets whose returns are less correlated with domestic equities.”

More information about the research, including how to purchase a copy, can be found here.

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