2020
PLANADVISER DCIO Survey

You don’t need to be Charles Darwin to admire the remarkable evolution in defined contribution (DC) plan investment lineups. For example, the stable-value- and insurance-based products common many decades ago now compose only 10% of the market, and nearly two-thirds (65%) of assets reside in asset-allocation- or equity-based products. Such a transformation was fueled by the explosive growth in access to mutual funds, which captured over 70% of DC plan assets earlier this decade before falling to 56% this year.

For the past nine years, the annual PLANADVISER Defined Contribution Investment Only (DCIO) Survey has been chronicling changes such as these to point out the natural selection occurring in plan investments. This year’s survey aggregates responses from a record 43 asset managers, which collectively oversee more than $4 trillion in DC assets. Most of these providers (83%) have over 75% of DCIO assets in actively managed products, but the overall market is more balanced, with only 57% of total assets in active strategies, versus 43% in passive strategies. While many expect that interest in passive will continue for the near future, further evolution in the market may be driven by disruptive events such as recent legislative changes or the COVID-19 pandemic. Only time will tell. —Brian O’Keefe

Art by Melinda Beck