Fuse Blog

CITs Overtake Mutual Funds in Target-Date Market

  • As of December 2023, target-date assets in collective investment trusts (CITs) reached $1.78 trillion, surpassing the $1.73 trillion in target-date mutual funds and ETFs.
  • CITs dominate target-date product development, with 272 individual fund launches since 2019 compared with 128 launches in mutual funds and 10 in ETFs.
  • CITs have emerged as a top choice for plan sponsors in the retirement plan market, offering unique advantages. As an institutional product vehicle, the CIT has lower operating costs than ‘40 Act funds, and its fees are typically negotiable.
  • The CIT vehicle offers growth potential, especially within the target-date market in DC plans. CIT use is still concentrated among larger plans, but they are gradually coming down market.

CIT Assets by Morningstar Category

Blog 4.16.24

Source: Morningstar, FUSE Research