Tag: collective investment trusts

The lawsuit against Principal Global Investors and related entities was abandoned.

A similar lawsuit was filed in May against an investment manager and a different plan sponsor.

The lawsuit argues that while the TDFs in the plan are CITs, they are private label CITs with much higher expense ratios than the typical CITs offered by JPMorgan.

Among the attractive but less-often-discussed features of collective investment trusts is the fact that the sponsoring trustee—a bank or trust company—must commit to acting in the best interest of unit holders.

The bill introduced to Congress is designed to ensure public sector and nonprofit retirement plans have the same access to low-cost investments as for-profit retirement plans do.

The investment firm will be shifting all of its focus to its CIT target-date series.

“We’ve heard the need for these investment options in 403(b) plans from advisers, consultants and plan sponsors for decades,” says Bruce Corcoran, managing vice president/head of 403(b) Business at ICMA-RC.

The two entities look to encourage CIT adoption among investors, a move that they say has stalled due to low awareness of the funds.

While they have grown at a compound annual growth rate of 7.25% a year in the past five years, if advisers were better educated about them and if the transparency issue could be addressed, that growth could rise significantly, according to the research firm.

A BrightScope/ICI study also found collective investment trusts (CITs) accounted for a larger share of assets in larger plans than smaller plans.

The CIT product information database was created in collaboration with Broadridge Advisor Solutions and is designed to support the client service needs of financial advice professionals.