Defined Contribution plan participants live a harsh reality: Despite the choices they are given in line with the plan sponsor’s fiduciary responsibility and policy statements, they are not allocating their assets in a diversified way.
Robert Capone, Executive Vice-President with BNY Mellon Retirement, in a whitepaper, Investment choice with Defined Contribution plans: style box consistency dilemma, discusses a new paradigm for DC investors that differs from what he calls “style-box” investing. “If you look at Defined Benefit plans, they are definitely invested in non-traditional style strategies,” he explains. “Our focus on the DC side would be to take away some of those DB allocation approaches in non-traditional type strategies.”
