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May 1, 2018
PHILLIP A. BRAUN
Retirement Plans
Retirement plans are regulated under the Employee Retirement Income Security Act of 19741
and the Pension Protection Act of 2006,2 which set minimum standards for most private pension
plans to provide protection for individuals. Tese acts defne the necessary fduciary, reporting,
disclosure, minimum benefts, and minimum funding requirements for pension plans.
Defned contribution retirement plans are retirement plans in which an employee (often in
conjunction with their employer) contributes to a retirement savings account; upon retirement,
the employee can withdraw the accumulated funds—with any earnings from their investments—
from the account. Te retirement beneft is not fxed in advance; rather, it depends on the amount
contributed to the retirement account over time and how much the account has earned.
401(k) and 403(b) retirement plans are defned contribution retirement plans. Te names refer
to the sections of the IRS tax code that outline these plans. 401(k) plans started with the Revenue
©2018 by the Kellogg School of Management at Northwestern University. Tis case was prepared by Professor Phillip
A. Braun. Cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements,
sources of primary data, or illustrations of efective or inefective management. Some details may have been fctionalized
for pedagogical purposes. To order copies or request permission to reproduce materials, call 800-545-7685 (or
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electronic, mechanical, photocopying, recording, or otherwise—without the permission of Kellogg Case Publishing.
M U T UA L F U N D S FOR RETIREMENT ACCOUNTS (A) KE1056
Act of 1978, which included a provision stating that employees would not be taxed on income they
elected to defer into retirement savings rather than receive as current income. Tis provision would
be incorporated into the Internal Revenue Code as Section 401(k), hence the name for this type of
savings plan. Te main distinction between 401(k) and 403(b) plans is the type of employers that
can ofer them: 401(k) plans are ofered by for-proft organizations and 403(b) plans by certain
non-proft organizations such as higher education institutions.3 Historically, 403(b) plans ofered
a more restricted set of investment options for participants than 401(k) plans, but more recently
403(b) plans had begun to ofer a broader range of options.
Under 401(k) and 403(b) plans, employees contribute a portion of their wages, often with a
matching contribution from their employers. Tese contributions are excluded from the employee’s
taxable income—taxes are not paid on this portion of the income until the money is withdrawn.
Any earnings on the retirement account, including dividends distributions, are also not taxable
until the money is withdrawn. In 2017, the maximum individual contribution per year that
could be made to 401(k) and 403(b) accounts for those under age 50 was $18,000; the limit was
$24,000 for those over age 50. Employers could ofer additional matching contributions up to a
total contribution maximum of $54,000 for those under age 50 and $60,000 for those over age
50.4 Tese maximums were expected to rise in the future to capture cost-of-living adjustments.
Employees could begin to withdraw funds from their 401(k) and 403(b) accounts at age 59½. If
they withdrew money earlier than this, they had to pay a 10% penalty plus taxes.5
Another option for retirement savings are defned beneft retirement plans. In these pension plans,
employers make predetermined monthly payments to a retired employee using a formula based on
that employee’s earnings history, tenure of service, and age. Te retirement beneft, therefore, is not
directly dependent on an individual’s own contribution to a retirement plan and the investment
returns on those contributions. Te employer bears the risk of meeting the retirement benefts
under defned beneft plans, whereas the worker bears the risk under defned contribution plans.
Historically, corporate and government retirement plans were predominantly defned beneft
plans. With the introduction of 401(k) plans in 1978, however, corporations gradually moved to
defned contribution plans. Government-sponsored retirement plans were much slower to make
the transition. Investments in defned contribution and beneft plans in the United States totaled
more than $15 trillion in 2016, with about $7 trillion in defned contribution plans, $3 trillion
in private defned beneft plans, and the remainder in public defned beneft plans.6 Assets in
private defned beneft plans fell from 80% of private retirement plan assets in 1975 to less than
40% in 2016.7
Mutual Funds
At the end of 2016, 55% of the money invested in defned contribution plans was invested
in mutual funds.8 Mutual funds are investment vehicles that pool investors’ money to purchase
a portfolio of stocks, bonds, or other securities. For the typical small investor, mutual funds are
a smart and cost-efective way to invest—with relatively little money an investor can purchase a
part of a large, professionally managed diversifed portfolio (most mutual funds hold hundreds of
securities) that can be easily bought and sold.
Mutual funds are regulated by the Investment Company Act of 1940 (40 Act),* together with
the Investment Advisers Act of 1940, the Securities Exchange Act of 1934, and the Securities Act
of 1933. Te goal of the 40 Act was to give the public confdence in pooled investment companies,
such as mutual funds, by regulating their organization, disclosure, investment objectives, and
operations by providing transparency, liquidity, oversight, limits on leverage, and limits on how
managers can be remunerated in such investment companies.9
In 2016, mutual fund companies had almost $16.6 trillion in assets under management.
Households were the largest category of investors in those mutual funds; 44% of US households
owned mutual funds.10 Almost 22% of household assets were held in mutual funds, up from 2%
in 1980,11 with the median household having savings of $125,000 in mutual funds.12 Figure 1
shows the breakdown of mutual fund investments in 2016 by type of investment: equity, bond,
money market, or hybrid fund. Figure 2 shows the same breakdown for defned contribution plan
investments for 2016. Te main distinction is that defned contribution plans have a larger share
of investments in hybrid funds that include target retirement date funds.
Hybrid
%
Money Market
17%
Equity
53%
Bond
22%
Source: Investment Company Institute, “2017 Investment Company Fact Book,” p. 28.
* Te 40 Act refers to the 1940 Act itself, subsequent amendments (1970), and rules issued by the Securities and
Exchange Commission under the Act.
Hybrid
26%
Money Market
3%
Equity
60%
Bond
11%
Source: Investment Company Institute, “2017 Investment Company Fact Book,” p. 159.
Tere are two main classes of mutual funds, actively managed funds and passively managed
funds. Passively managed funds are also called index funds because they are often simply passively
mimicking a common index such as the S&P 500 Index or the Dow Jones Index. In contrast,
actively managed funds attempt to beat an underlying index. Of the $16.6 trillion that the mutual
fund industry had under management in 2016, 15% was in index funds.13 More specifcally, 25%
of all equity mutual fund assets in 2016 were passively managed, up from 10% in 2001.14
Mutual funds have two types of expenses that they pass on to investors: expense ratios and sales
loads. Annual expenses, including administration costs, are paid by investors indirectly and are
included in the expense ratio. Sales loads are typically paid at the time a fund is purchased (front-
end loads) and are compensation for a fnancial advisor. Figure 3 shows the expense ratios in 2000
and 2016 for equity, bond, and hybrid funds. For all three types of funds, expense ratios had fallen
dramatically. Likewise, the average sales load fees that investors paid over this period declined; the
average sales load fee that investors paid in 2016 was less than 1%, a decline from around 1.4% in
2000.15 Most mutual funds invested in via 401(k) and 403(b) plans are no-load low-cost mutual
funds—for example, equity mutual funds invested in through 401(k) accounts had an average
expense ratio in 2016 of only 0.53% compared to an expense ratio of 0.67% for equity mutual
funds industry-wide.16
1.0%
0.8%
Expense Ratio
0.6%
0.4%
0.2%
0.0%
Equity Bond Hybrid
2000 2016
Source: Investment Company Institute, “2017 Investment Company Fact Book,” p. 89.
Looking deeper into the expense ratios, Figure 4 compares the expense ratios of active equity
and bond funds with index equity and bond funds in 2016. Te expense ratios for index funds are
at least 1/6 below those of active funds. Figure 5 presents the expense ratios for equity funds by
how the fund is managed. Equity blend funds have the lowest expense ratio, and world funds have
the highest.
Figure 4: Average Asset-Weighted Expense Ratios for Active vs. Index Funds, 2016
0.9%
0.8%
0.7%
0.6%
Expense Ratio
0.5%
0.4%
0.3%
0.2%
0.1%
0.0%
Equity Bond
Active Index
Source: Investment Company Institute, “2017 Investment Company Fact Book,” p. 96.
0.8%
0.7%
0.6%
0.5%
Expense Ratio
0.4%
0.3%
0.2%
0.1%
0.0%
Growth Sector Value Blend World
Source: Investment Company Institute, “2017 Investment Company Fact Book,” p. 93.
Once employees became eligible for the retirement plan, Northwestern automatically made
contributions to their retirement plan equal to 5% of their eligible earnings every pay period. For
the most part, “eligible earnings” meant an employee’s base salary. Employees could also make
voluntary additional contributions to their retirement plans that were matched by the university.
If an employee made a voluntary contribution of at least 1% of his or her eligible earnings (but
not exceeding 5%), the university made a matched retirement contribution equal to 100% of
the employee’s contribution. Finally, employees could make voluntary supplemental retirement
contributions* (contributions in excess of 5% of their eligible earnings) up to the federally mandated
limit.† Northwestern did not match these voluntary supplemental retirement contributions. All
contributions to an employee’s retirement plan below the federally mandated limit were made on
a before-tax basis.17
* Northwestern employees were able to make supplemental contributions to their retirement plan prior to becoming
eligible to participate in the retirement plan. Furthermore, if they ceased to be eligible to participate in the
retirement plan, they could continue to make contributions.
†
As noted earlier in the case, the annual limit was $18,000 for those under 50 and $24,000 for those over 50.
Northwestern’s 403(b) retirement plan was managed by Fidelity Investments.* Fidelity was
the fourth-largest mutual fund and fnancial services company in the world in 2016, ofering more
than 10,000 mutual funds to its customers with more than $2 trillion in assets under management.
As the overall manager of Northwestern’s 403(b) plan, Fidelity received a management fee from the
assets under management in the plan.
In the summer of 2016, Northwestern introduced a new investment structure for its
retirement plans. A committee of Northwestern faculty and administrators (the Northwestern
University Retirement Investment Committee) put together a list of 24 core funds among which
Northwestern employees could allocate their retirement savings, including a selection of US equity
and bond funds and international equity funds. Tese were not just Fidelity funds, but also funds
managed by Goldman Sachs, Vanguard, Met Life, and others. Tese 24 core funds were split across
a three-tier investment structure that provided employees fexibility to choose investments based
on their investment style and preference. In addition, a fourth tier provided access to many more
funds, but these were not evaluated by the investment committee.
• Te Tier 1 investments were target retirement date mutual funds. A target date fund is a
mixture of stocks and bonds, both US and international, in which the percentage of stocks
versus bonds varies depending on the investor’s age. Te younger a person is, the higher
the percentage of stocks in the fund. As the person’s target retirement date becomes closer,
the fund manager adjusts the asset allocation mix to make it more conservative. Target date
funds are a good investment choice for someone seeking a diversifed mix of stocks, bonds,
and short-term investments in one investment option or who does not feel comfortable
making asset allocation choices over time. Te list of Northwestern’s nine available target
retirement date funds and their fees is presented in Exhibit 1.
• Tier 2 investments were passively managed (index) mutual funds. Te list of four available
Tier 2 core mutual funds and their strategies is presented in Exhibit 2.
• Tier 3 investments were actively managed mutual funds. Te list of 11 Tier 3 core mutual
funds and their strategies is presented in Exhibit 3.
• Tier 4 was an expanded set of mutual funds that were accessed directly from the plan
sponsor. Tier 4 provided Northwestern employees with access to thousands of mutual funds
from hundreds of mutual fund companies. Te university neither evaluated nor monitored
these investments. It was the employee’s responsibility to ensure that the investments
they selected were suitable for their situation, including their goals, time horizon,
and risk tolerance.
Morningstar Database
To help herself select the funds to invest in, Alice purchased access to the Morningstar mutual
fund database. Morningstar, a Chicago-based investment research frm founded in 1984 by Joe
* Northwestern also had a second retirement plan sponsor, TIAA-CREF, but to simplify this case only Fidelity
is considered.
Mansueto, launched its mutual fund database in 1986. Te frm provided information on some
525,000 investment oferings around the world, including stocks, bonds, mutual funds, and
exchange-traded funds. Te company also ofered investment management services.
Using the Morningstar database, Alice could look up the historical performance of a fund,
its fees, the assets under management, the Morningstar Rating™, the capital asset pricing model’s
alpha and beta, fund management, main holdings, the Morningstar Category™ or management
style, an analyst report (if the fund was followed by a Morningstar analyst), and much more.
Te Morningstar data for Northwestern’s Tier 2 and 3 funds is presented in Exhibit 4 and the
defnitions for the Morningstar Categories in Exhibit 5.
Te Morningstar Rating for funds, also called the star rating, was a proprietary mutual fund
risk- and cost-adjusted performance scale of one to fve (fve being the best). Investors could
evaluate a fund’s past performance within Morningstar’s Categories or mutual fund style classes
such as large cap growth fund or intermediate bond fund. Te ratings took into account all sales
charges, loads, and other fees, as well as the historical risk of a fund. Te Morningstar Rating was
intended as a frst step in the mutual fund evaluation process for investors. A high rating was not
a sufcient basis for investment decisions, although it enabled investors to distinguish among
funds that used similar investment strategies. Morningstar’s rating system was based on expected
utility theory—the idea that investors care more about poor outcomes than good outcomes and
are willing to give up some portion of their expected return in exchange for greater certainty of
expected return. Te rating accounted for all variations in a fund’s monthly returns but with more
emphasis on downward variations. Only 10% of funds within an investment category were rated
fve-star, 22.5% four-star, 35% three-star, 22.5% two-star, and 10% one-star.
Data Analytics
While the Morningstar database provided a lot of useful information, it was lacking in
certain areas. Due to their proprietary nature, Morningstar Ratings were rather opaque, and it
was not clear how the ratings incorporated risk and fees into their rankings. Furthermore, the
ratings compared funds within a Morningstar Category, but would not help compare funds across
Morningstar Categories.
Alice recalled learning about the Sharpe ratio—a risk-return trade-of measure developed by
William Sharpe, one of the 1990 Noble laureates in economics—in an investments course at
college. Mathematically the Sharpe ratio is expressed as:
Te average return and standard deviation are calculated using a fund’s historical returns and the
risk-free return is typically the return on a one-month Treasury bill.
Alice remembered that the Sharpe ratio was used to compare the risk-return trade-of between
well-diversifed portfolios; the portfolio with the higher Sharpe ratio yields the better return per
unit of risk. Terefore, she felt the Sharpe ratio could be a useful metric in selecting the optimal
mix of mutual funds.
Alice also recalled from her class the role of the correlation coefcient in measuring the
diversifcation possibilities between two portfolios, though she was not quite sure how to use the
correlation coefcient to help her in her fund selections. She recalled that the correlation coefcient
is bounded between 1 and -1. If two portfolios move in perfect sync with each other (i.e., both
rising or falling together), then they are perfectly positively correlated and have a correlation
coefcient of 1. If two portfolios move in opposite directions (i.e., one rises while the other falls),
they are perfectly negatively correlated and have a correlation coefcient of -1. If two portfolios
move independently of each other, then they have a correlation coefcient of 0. Portfolios with a
high positive correlation, such as 0.9, are very similar and do not ofer much diversifcation. As the
correlation between two portfolios moves from 1 to -1, the better the diversifcation possibilities.
Alice collected as much historical data as she could for each of the funds. Unfortunately,
because some of the funds were fairly new oferings, she could collect only 99 months of consistent
historical data across the funds. Furthermore, there was no return data available for the Blackrock
life cycle funds. Te return data she did collect were net of all fees. Tis return data are presented
in Exhibit 6.* From the Wall Street Journal, Alice learned that the current one-month Treasury bill
rate was approximately 1% on an annualized basis.
Conclusion
Alice’s goal in saving for retirement was to ensure that she individually would have enough
to live on after she retired at the age of 65. She was not sure how much of her $75,000 annual
salary she should save toward retirement. Her husband earned $80,000 per year and together they
wanted to concentrate on saving for a new car and a down payment for a house. All of their other
major fnancial decisions, such as a college savings plan, healthcare, and monthly expenses, were
adequately planned for.
In general, she felt that saving for retirement was a low priority for her right now—retirement
seemed far enough down the road that she could worry about it later. She found the additional 5%
matching by Northwestern enticing, but she was not sure she wanted to set aside that much toward
her retirement at this point, especially since her husband already had a 401(k) account at his job.
Should she just not save for retirement right now?
* To get the longest historical record for each mutual fund, it was necessary to use diferent share classes across time
for some mutual funds. For example, the historical record for one of Northwestern’s funds, the American Funds
New World Fund Class R-6, was taken from a diferent class of the fund, its Institutional Class, because the R-6
did not have a complete historical record. Note that although the two funds held the same investments, they did
not have the same returns because they had diferent fee structures.
If she did start investing, she was not sure how to pick the funds for her retirement account.
Although there were only 15 Tier 2 and 3 funds, there were thousands more if she considered
Tier 4 funds. Furthermore, although the information from Morningstar was interesting and
the statistics she calculated insightful, they did not give her the absolute clarity she hoped for.
In general, she felt somewhat overwhelmed by the whole prospect of selecting funds for her
retirement account. Should she just go with the target-date retirement fund?
Te Retirement Fund is designed for those already in retirement, and the funds with a year in
their name are for those expecting to retire around the year indicated. Te funds are managed to
gradually become more conservative as they approach their target date. Te investment risk of each
target date fund changes over time as its asset allocation changes.
Tese funds are intended for someone seeking an investment option that gradually becomes
more conservative over time and who is willing to accept the volatility of the markets, as well as
someone who is seeking a diversifed mix of stocks, bonds, and short-term investments in one
investment option or who does not feel comfortable making asset allocation choices over time.
Exhibit 5: Morningstar Category Definitions for Tier 2 and 3 Core Mutual Funds
Category Description
Large cap blend Large-blend portfolios are fairly representative of the overall US stock market in size,
growth rates and price. Stocks in the top 70% of the capitalization of the US equity market
are defined as large cap. The blend style is assigned to portfolios where neither growth nor
value characteristics predominate. These portfolios tend to invest across the spectrum of
US industries, and owing to their broad exposure, the portfolios’ returns are often similar to
those of the S&P 500 Index.
Large value Large-value portfolios invest primarily in big US companies that are less expensive or growing
more slowly than other large-cap stocks. Stocks in the top 70% of the capitalization of the
US equity market are defined as large cap. Value is defined based on low valuations (low price
ratios and high dividend yields) and slow growth (low growth rates for earnings, sales, book
value, and cash flow).
Large growth Large-growth portfolios invest primarily in big US companies that are projected to grow
faster than other large-cap stocks. Stocks in the top 70% of the capitalization of the US equity
market are defined as large cap. Growth is defined based on fast growth (high growth rates
for earnings, sales, book value, and cash flow) and high valuations (high price ratios and low
dividend yields). Most of these portfolios focus on companies in rapidly expanding industries.
Mid cap blend The typical mid-cap blend portfolio invests in US stocks of various sizes and styles, giving it a
middle-of-the-road profile. Most shy away from high-priced growth stocks but aren’t so price-
conscious that they land in value territory. The US mid-cap range for market capitalization
typically falls between $1 billion and $8 billion and represents 20% of the total capitalization
of the US equity market. The blend style is assigned to portfolios where neither growth nor
value characteristics predominate.
Mid cap value Some mid-cap value portfolios focus on medium-size companies while others land here
because they own a mix of small-, mid-, and large-cap stocks. All look for US stocks that are
less expensive or growing more slowly than the market. The US mid-cap range for market
capitalization typically falls between $1 billion and $8 billion and represents 20% of the total
capitalization of the US equity market. Value is defined based on low valuations (low price
ratios and high dividend yields) and slow growth (low growth rates for earnings, sales, book
value, and cash flow).
Mid cap growth Some mid-cap growth portfolios invest in stocks of all sizes, thus leading to a mid-cap profile,
but others focus on midsize companies. Mid-cap growth portfolios target US firms that are
projected to grow faster than other mid-cap stocks, therefore commanding relatively higher
prices. The US mid-cap range for market capitalization typically falls between $1 billion and
$8 billion and represents 20% of the total capitalization of the US equity market. Growth
is defined based on fast growth (high growth rates for earnings, sales, book value, and cash
flow) and high valuations (high price ratios and low dividend yields).
Small cap blend Small-blend portfolios favor US firms at the smaller end of the market-capitalization range.
Some aim to own an array of value and growth stocks while others employ a discipline that
leads to holdings with valuations and growth rates close to the small-cap averages. Stocks
in the bottom 10% of the capitalization of the US equity market are defined as small cap.
The blend style is assigned to portfolios where neither growth nor value characteristics
predominate.
Small growth Small-growth portfolios focus on faster-growing companies whose shares are at the
lower end of the market-capitalization range. These portfolios tend to favor companies in up-
and-coming industries or young firms in their early growth stages. Because these businesses
are fast-growing and often richly valued, their stocks tend to be volatile. Stocks in the bottom
10% of the capitalization of the US equity market are defined as small cap. Growth is defined
based on fast growth (high growth rates for earnings, sales, book value, and cash flow) and
high valuations (high price ratios and low dividend yields).
. . .
Exhibit 5 (continued)
Category Description
Intermediate- Intermediate-term bond portfolios invest primarily in corporate and other investment-grade
term bond US fixed-income issues and typically have durations of 3.5 to 6.0 years. These portfolios are
less sensitive to interest rates, and therefore less volatile, than portfolios that have longer
durations. Morningstar calculates monthly breakpoints using the effective duration of the
Morningstar Core Bond Index in determining duration assignment. Intermediate-term is
defined as 75% to 125% of the three-year average effective duration of the MCBI.
Short-term bond Short-term bond portfolios invest primarily in corporate and other investment-grade US
fixed-income issues and typically have durations of 1.0 to 3.5 years. These portfolios are
attractive to fairly conservative investors, because they are less sensitive to interest rates
than portfolios with longer durations. Morningstar calculates monthly breakpoints using the
effective duration of the Morningstar Core Bond Index in determining duration assignment.
Short-term is defined as 25% to 75% of the three-year average effective duration of
the MCBI.
Foreign large Foreign large-blend portfolios invest in a variety of big international stocks. Most of these
blend portfolios divide their assets among a dozen or more developed markets, including Japan,
Britain, France, and Germany. These portfolios primarily invest in stocks that have market
caps in the top 70% of each economically integrated market (such as Europe or Asia
excluding Japan). The blend style is assigned to portfolios where neither growth nor value
characteristics predominate. These portfolios typically will have less than 20% of assets
invested in US stocks.
Foreign large Foreign large-growth portfolios focus on high-priced growth stocks, mainly outside of the
growth United States. Most of these portfolios divide their assets among a dozen or more developed
markets, including Japan, Britain, France, and Germany. These portfolios primarily invest in
stocks that have market caps in the top 70% of each economically integrated market (such as
Europe or Asia excluding Japan). Growth is defined based on fast growth (high growth rates
for earnings, sales, book value, and cash flow) and high valuations (high price ratios and low
dividend yields). These portfolios typically will have less than 20% of assets invested in US
stocks.
Diversified Diversified emerging-markets portfolios tend to divide their assets among 20 or more
emerging nations, although they tend to focus on the emerging markets of Asia and Latin America
markets rather than on those of the Middle East, Africa, or Europe. These portfolios invest
predominantly in emerging market equities, but some funds also invest in both equities and
fixed income investments from emerging markets.
Real estate Real estate portfolios invest primarily in real estate investment trusts of various types. REITs
are companies that develop and manage real estate properties. There are several different
types of REITs, including apartment, factory outlet, health-care, hotel, industrial, mortgage,
office, and shopping center REITs. Some portfolios in this category also invest in real estate
operating companies.
Exhibit 6: Historical Monthly Returns for Tier 2 and Tier 3 Core Funds
S e e Exh ib it 6 in th e E xhib its E xc e l fi l e .
Endnotes
1 US Department of Labor, “Employee Retirement Income Security Act (ERISA),” accessed October 2017,
https://www.dol.gov/general/topic/retirement/erisa.
2 Pension Protection Act, Pub. L. No. 109-280 (2006), https://www.gpo.gov/fdsys/pkg/PLAW-109publ280/pdf/
PLAW-109publ280.pdf.
3 Internal Revenue Service, “Publication 571, Tax-Sheltered Annuity Plans (403(b) Plans),” revised January 2018,
https://www.irs.gov/publications/p571/ch01.html.
4 Internal Revenue Service, “Retirement Topics—401(k) and Proft-Sharing Plan Contribution Limits,” accessed
June 2017, https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-proft-
sharing-plan-contribution-limits.
5 Internal Revenue Service, “401(k) Plans,” accessed June 2017, https://www.irs.gov/retirement-plans/401k-plans.
6 Investment Company Institute, “2017 Investment Company Fact Book,” p. 136.
7 Federal Reserve Bank of St. Louis Economic Research, “Flow of Funds,” accessed October 2017,
https://fred.stlouisfed.org/categories/32251.
8 Investment Company Institute, “2017 Investment Company Fact Book,” p. 158.
9 US Securities and Exchange Commission, “Investment Advisers Act of 1940,” accessed January 2018,
https://www.sec.gov/about/laws/ica40.pdf.
10 Investment Company Institute, “2017 Investment Company Fact Book,” p. 9.
11 Ibid., p. 11.
12 Ibid., p. 113.
13 Ibid., p. 44.
14 Ibid., p. 45.
15 Ibid., p. 103.
16 Ibid., p. 109.
17 Northwestern University Human Resources Department, “Northwestern University Retirement Plan and
Voluntary Savings Plan Summary Plan Description,” efective January 1, 2011, http://www.northwestern.edu/
hr/benefts/retirement-plans/Retirement_SPD.pdf.