Products July 2, 2012

Wilshire Launches Compass Portal for 2Q Database Updates

Wilshire Associates Incorporated rolled out the Wilshire Compass Portal, an enhanced Web-based investment manager questionnaire that populates its PC-based fund management tool, Wilshire Compass.
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The evolution of investment strategies from public markets into new market segments, such as private equity, private real estate, target-date funds and risk-parity strategies, necessitates questionnaires designed specifically to each unique investment process, according to Julia Bonafede, president of Wilshire Consulting. The tool gives consultants and plan sponsors greater insight into their strategies, she said.

Charles Stunkard, managing director of Wilshire Associates, said the Wilshire Compass Portal is a revamped and rebranded version of Wilshire Odyssey. “We will be collecting new information online, including manager biographies, organizational charts, and other information that investment managers will be asked to upload,” Stunkard said. “We also will be integrating the manager research due-diligence questionnaires into the new website to provide managers with one point of contact in providing Wilshire Associates the information needed to evaluate and score the investment management firm and their products.”

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Wilshire collects information on more than 33,000 investment products. 

Recently, Wilshire added qualitative evaluations to Wilshire Compass Monitor, which will allow fund sponsors to further leverage off the work Wilshire is doing and combine it with in-house investment expertise. 

Wilshire Compass combines Wilshire’s databases with investment technology developed at the firm over the past 40 years. The Wilshire Compass allows users to address numerous aspects of a disciplined investment process, including:

• Formulate investment policy and implement strategies;

• Monitor and evaluate asset class and total fund performance and risk;

• Develop asset-allocation and rebalancing recommendations;

• Select and evaluate investment managers; and

• Analyze and optimize manager teams.

Wilshire Compass analytics can be tailored to fit the user’s individual investment process. The product is supported by investment professionals who provide user training and consultative support.

Data & Research July 2, 2012

DC Assets Fastest Growing Among Employer-Sponsored Plans

Assets in employer-sponsored retirement plans, IRAs and annuities totaled $17.9 trillion at year-end 2011, up slightly from 2010, according to the Investment Company Institute (ICI).
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The largest components of retirement assets were IRAs and employer-sponsored defined contribution (DC) plans, holding $4.9 trillion and $4.5 trillion, respectively, at year-end 2011. Other employer-sponsored pensions include private-sector defined benefit (DB) pension funds ($2.4 trillion), state and local government employee retirement plans ($3.0 trillion), and federal government plans—which include both federal employees’ DB plans and the Thrift Savings Plan ($1.5 trillion). In addition, there were $1.6 trillion in annuity reserves outside of retirement plans at year-end 2011.   

The 2012 edition of ICI’s Fact Book says 69% of U.S. households (or 82 million households) reported that they had employer-sponsored retirement plans, IRAs, or both in May 2011. Sixty-one percent of U.S. households reported that they had employer-sponsored retirement plans—that is, they had assets in DC plan accounts, were receiving or expecting to receive benefits from DB plans, or both. Thirty-nine percent of households reported having assets in IRAs. Thirty-one percent of households had both IRAs and employer-sponsored retirement plans.   

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Ownership of IRA and DC plan assets has become more common with each successive generation of workers. This can be seen by comparing the ownership rates of households grouped by the decade in which the household heads were born. At any given age, younger households have had higher IRA and DC plan ownership rates over time. For example, in 2011, when they were 51 to 61 years of age, 71% of households born in the 1950s owned IRAs or DC plan accounts. By comparison, households born a decade earlier had a 66% ownership rate when they were 51 to 61 in 2001.   

At younger ages, the differences between birth cohorts are even greater; 71% of households with heads born in the 1970s held assets in IRAs or DC plan accounts in 2011 when they were ages 31 to 41, while 54% of households born in the 1950s owned IRAs or DC plan accounts in 1991, when they were ages 31 to 41.  

Assets in employer-sponsored DC plans have grown more rapidly than assets in other types of employer-sponsored retirement plans over the past quarter century, increasing from 27% of employer plan assets in 1985 to 40% at year-end 2011. With $3.1 trillion in assets at year-end 2011, 401(k) plans held the largest share of employer-sponsored DC plan assets. 403(b) plans and 457 plans held another $941 billion in assets. The remaining $520 billion in DC plan assets was held by other DC plans without a deferral feature.  

The 2012 Investment Company Institute Fact Book is here.  

 

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