UAT Inc. has developed a 401(k) tool for sponsors offering target-date funds that will allow them to scrutinize the holdings and glidepath of the funds.
The inability to see holdings in real time has put undue pressure on compliance personnel who supervise target-date funds, said Tom Warren, president of UAT. The Unified Compliance and Control System from UAT provides the necessary real-time transparency to deal with this supervisory shortcoming in a cost-efficient manner.
Warren noted that because of scrutiny by Congress, the Securities and Exchange Commission and the Department of Labor on target-date funds glidepaths, there is an ever greater need for comprehensive control of target-date products.
The kind of enhanced oversight the system affords will go a long way toward protecting target-date funds from undesirable asset allocation drift. Its like a GPS for target-date funds: know where you are, know where you need to go.