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Portfolio > ETFs

ETFs Coming to a 401(k) Plan Near You

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Will ETFs challenge mutual funds inside your client’s 401(k) retirement plan? One place to look for answers will be Invest N Retire’s second annual ETF retirement plan conference, which will be held October 17-19 in Portland, Ore.

Invest N Retire is a leading provider of 401(k) solutions that utilize exchange-traded funds, so it naturally has a professional interest in the role of ETFs in employer-sponsored direct-contribution plans. Nonetheless, interest in including ETFs as an investment option inside qualified retirement programs is on the rise.

Part of what’s at stake is that, according to a recent report on market-linked financial products from Tiburon Strategic Advisors, actively managed mutual funds are being challenged like never before. Fallout from the fund timing scandals of a few years ago has tarnished the image of some firms and others are routinely outperformed by the key stock market indexes. Lower expense ratios was another reason cited for the increasing popularity of indexed financial products.

With assets in market-linked products in the vicinity of $4 trillion, ETFs still represent only a fraction of the total retirement marketplace. The Investment Company Institute reported in May that ETF assets were up to $324.68 billion. In contrast, indexed separate accounts dominate with over $3 trillion in total assets and index mutual funds are over $500 billion.

Conference topics include how to draft an investment policy statement, how to gather 401(k) assets and how to design an asset allocation model with ETFs. Representatives from Barclays Global Investors, Nasdaq Stock Market, Select Sector SPDRs and the Vanguard Group will be participating.

“The goal with a 401(k) plan is not to pick the best funds, it’s to provide an adequate retirement for the participants,” says Darwin Abrahamson, CEO, Invest n Retire.

Registration information can be obtained by visiting or calling (503) 419-2894 x101.


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