Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.
The Markets April 25, 2013
Larger Plans Favor Alternatives
The Wilshire Trust Universe Comparison Service (TUCS) Spotlight found little
difference between large and small plans’ total performance levels in 2012.
Reported by Sara Kelly
According to Wilshire’s TUCS Spotlight—which focuses on some of the differences between large and small corporate plans’ investments—large plans saw a median return of 12.96% and small plans took in a median 12.49%. Their attitudes toward alternative investments, however, vary significantly.
The spotlight showed that large corporate plans are nearly three times as likely as small plans to invest in alternatives—61% of large corporate plans are invested in private equity with a median allocation of 6.6%, compared with 22% of small corporate plans invested in private equity with a median allocation of 5.2%.
With regard to real estate, large corporate plans were more than twice as likely to invest—43% of large plans and 20% of small plans allocated to real estate in 2012—though their allocations were similar at 4.6% and 5.0%, respectively.
The majority (95%) of large plans with real estate also had exposure to private equity, while only 31% of small plans with real estate also had exposure to private equity.