via Wall Street Journal
Don’t look now, but the mutual funds in your 401(k) may not be mutual funds after all.
In recent years, more 401(k) plans have replaced the mutual funds in their investment lineups with collective investment trusts. These investments look and act a lot like mutual funds, but generally have lower fees and disclose less about their inner workings to 401(k) participants.
Also known as collective trust funds, such investments currently account for $2.4 trillion, or 16%, of the $15 trillion in 401(k)-style and pension plans, up from $1.3 trillion (and 12.7% of the total) in 2009, according to the Investment Company Institute and Cerulli Associates, a research firm that specializes in the asset-management industry. The trusts are accounts available only to retirement plans. They are sponsored by banks and trust companies and are primarily overseen by banking regulators, rather than subject to mutual-fund rules enforced by the Securities and Exchange Commission.
