Don’t Write Off the Mutual Fund Structure Just Yet: 2017 NAPA 401(k) Summit
A dour political mood led to great sessions and great information in Sin City this year at the 2017 NAPA 401k Summit. One of the highlights is (always) a conversation with John Hancock Investments’ Gene Huxhold.
At the 2017 NAPA 401(k) Summit in Las Vegas, John Sullivan (401k Specialist) interviews Gene Huxhold, Senior Managing Director at John Hancock Investments, about the growing popularity of Collective Investment Trusts (CITs).
Huxhold clarifies that while CITs are praised mainly for their lower pricing, they also come with added complexity. Unlike mutual funds, CITs require separate trust agreements and additional administrative work whenever changes occur. Mutual funds, on the other hand, offer stronger regulatory protections and broader accessibility. Investors can easily find mutual fund data through multiple platforms like Morningstar, making transparency and information access much simpler.
Huxhold highlights John Hancock’s unique separate account structure within target-date funds. By working with managers to create accounts that mirror their open-market strategies, John Hancock ensures 100% ownership and daily visibility of these assets. This structure reduces exposure to market incidents since public money isn’t flowing in and out, a key vulnerability often cited in closed CIT structures.
The discussion underscores that despite the growing interest in CITs, mutual funds remain valuable because of their regulatory oversight, transparency, and accessibility—qualities especially important for plan sponsors and participants.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of 401(k) Specialist and Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots. Experienced financial services content executive specializing in creative new media delivery. He joined the American Retirement Association in 2023 as Chief Content Officer, overseeing communications for the organization, as well as its sister organizations.
