Are pensions no longer just buying stocks and bonds? Wall Street has found a new business!

Wall Street is never short of new stories, and this time, it’s Americans’ retirement savings.
The 401(k) alternative assets rule pushed by the U.S. Department of Labor has entered White House review. In the future, products such as private equity, real estate, and crypto assets may have more opportunities to be considered by retirement plans.
Why is this worth watching? Because retirement accounts hold enormous sums, and even if only a small portion flows into alternative assets, it could create new growth opportunities for the relevant investment industries.
But investment firms’ excitement doesn’t mean ordinary investors will necessarily make money.
Valuations, fees, redemption arrangements, and risk disclosures for alternative assets can all be much more complicated than those for ordinary index funds. Liquidity constraints in particular could leave investors at a disadvantage when they need cash.
It’s like adding more dishes to a retirement account’s menu, but a more varied menu doesn’t mean every dish is right for you.
How the rules are ultimately implemented and which products make it onto the investment menu are what’s truly worth watching next.$MU

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