Didn't see a thread on this already so I decided to start one. The Labor Department recently approved 401(k) plans to invest in PE. Sounds like a huge win for PE firms given the newfound access to capital. However, PE fund investing may not be everybody's ball game considering high fees, high risk/return profile of PE investments, a lot less liquidity, and the intricacies that go into fund investing such as picking star private market fund managers, running DD, and other processes that only financial giants and institutional investors have the capacity and resources to run (higher fees for their expertise?!?)
I'm no expert in portfolio management and 401(k) allocations but I do see this providing legal protection to firms offering target-date funds (TDFs) that bundle PE investments. On some level, it does benefit consumers (mainly "non-accredited investors") who get an opportunity to experience PE-like returns that they may not be enjoying in the public markets. Here is a link to the CNBC news article about this issue.
I do not have much knowledge on the subject so I'll shut up and let others chime in with their thoughts.
Labore non et corrupti eius perspiciatis ut. Dolor ipsum in itaque pariatur. Beatae in quibusdam in sit.
Et quaerat vel qui. Blanditiis est omnis eius debitis quia blanditiis. Et et cumque nulla voluptatem cum id pariatur.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...