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UBS launches target-date collective investment trusts for qualified retirement plans based on Morningstar Indexes


UBS Global Asset Management Trust Company is launching a series of target-date collective investment trust funds (CITs) that seek to track the performance of the Morningstar Lifetime Allocation Indexes. 

UBS expects to launch the CITs, which are for use exclusively by qualified retirement plans, in July. Morningstar Associates, LLC, a registered investment advisor and part of the Morningstar Investment Management group, will serve as a non-discretionary sub-advisor with respect to the CITs. Morningstar is the index provider.

"UBS Global Asset Management has been managing passive portfolios for more than 30 years," says Blake Moore, Head of Americas for UBS Global Asset Management. "Our experienced index investment professionals around the globe manage passive portfolios across asset classes including equities, fixed income and commodities. We are pleased to work with Morningstar to bring these CIT funds to defined contribution plans."

Available in three series – conservative, moderate, and growth – the CITs will be passively managed, low-cost investment selections. UBS is licensing the Morningstar Lifetime Allocation family of indexes as the benchmarks for the CITs. Launched in 2009, the Morningstar Lifetime Allocation Indexes comprises three series of target-date indexes that vary in aggressiveness and adjust their asset allocations over time to become more conservative. The indexes leverage Morningstar’s Total Wealth Approach to investing – a concept that goes beyond looking at an individual’s current wealth, and takes into account his or her personal prospects, goals, and resources when building portfolios. The Morningstar Investment Management group developed this proprietary investment methodology through years of award-winning academic research on capital market assumptions, lifetime finance, and advanced asset allocation optimisation techniques.

“Morningstar’s mission is to help investors reach their financial goals. In the defined contribution market, we do that by applying our best retirement research and methodologies to help average workers improve their retirement outcomes,” says Brock Johnson, head of retirement solutions for Morningstar. “As workers are increasingly turning to target-date investments, these new CITs will reach more employees and help them to achieve a secure retirement.”

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