Alternative asset managers are aggressively pursuing solutions to open the large 401(k) Defined Contribution plans in the US to private asset strategies. It is still early days but there have been enough meaningful partnerships among major alternative asset managers, target date fund managers, recordkeepers, and trust companies that it seems only likely to continue.

The latest report from Scientific Infra & Private Assets (SIPA), entitled “Private Assets are Coming to 401(k)s” shows that the current quarterly reporting practices of drawdown fund managers will not be sufficient for the 401(k) plans. Higher frequency pricing of assets and returns will be required to ensure plan participants are treated fairly. Performance of products aimed at the 401(k) market need to be benchmarked, and reasons for inclusion must be backed up with good data. privateMetrics data and analytics tools can help fiduciaries make better choices for inclusion, while providing evidence-based grounds to support their decision making, ensuring regulatory compliance.