Larger DC plans tend to offer fewer diversifiers than smaller plans and, as a result, allocate a greater share of assets to more traditional asset classes. This is a somewhat surprising finding, given that larger plans are typically more familiar with the potential benefits of alternative investments, particularly those that also sponsor defined benefit plans. In theory, larger plans should also have greater access to specialized investment options, including private assets, than smaller plans. How this apparent disconnect evolves will be worth watching.
Taken together, these trends suggest that asset allocation within DC core menus is shaped not solely by deliberate portfolio construction, but also by defaults, availability, and plan design choices. For investment professionals, understanding how those forces interact is increasingly important as DC plans continue to play a larger role in retirement savings.
[1] Cerulli (2025)