“This explains why three-fourths of non-Erisa 403(b) holdings in portfolios are these expensive annuities. There are practically none in 401(k)s.”
Something doesn’t compute here that 75% of 403-B holdings are in annuities. Teachers aren’t dumb. They’re not going to sit idly by and allow their school board or state to push them into annuities during their working years.
Would be nice if Rithholtz could be a lot more specific? What age group? What state? What professions? Were this written 30 years ago I would have surmised these folks went into those annuities prior to the law being changed around ‘74 and held onto them. But today?
Now, there’s a move in Michigan and elsewhere to get rid of DB pension plans. In some cases they’ve been replaced by matching contributions into 403 B plans. I suppose that such a setup might possibly give both parties some incentives to go with traditional annuities - especially the employer.
-
Racking my brain on this one. Maybe in some lower education, lower skill-set public sectors there’s a feeling among workers that stocks and mutual funds represent risk, whereas they may view annuities as safer. Don’t know. Just trying to make sense of that 75% figure.

I really want to get an REIT investment into my portfolio. I am happy with Doubleline as a company as I have a lot of my portfolio in DSEEX and have been very happy with the returns.
https://doublelinefunds.com/colony-real-estate-and-income-fund/
It seems the investment strategy with DLREX is similar to DSEEX in that they "Maintain a core portfolio of debt instruments that focuses on global fixed income sector rotation while simultaneously obtaining exposure to U.S. REITs through the Colony Capital Fundamental US Real Estate Index. The unique structure of the DoubleLine Colony Real Estate and Income Fund allows investors to potentially simultaneously access returns of the real estate equity markets and fixed income markets. By using an equity index swap, $1 invested in the strategy provides approximately $1 of exposure to each market."
DLREX just rolled out in December 2018 so it doesn't have much history. Another downside is the ER at 1%.
I have found plenty of prior conversations around DSEEX/DSENX but haven't fund any on DLREX. Does anybody have any insight or currently invested in DLREX? What are your thoughts? Or would I be better served going with either an active REIT fund or REIT index fund?

I babysit a colleague's money, and his wife's. After the initial move in 2010, there's hardly been a need to touch it. She's a teacher in Ohio now, which wasn't the case in 2010. Don't know a thing about her 403b, or whether she's contributing. My colleague trusted a professional broker who also happened to be an ordained Minister. That "Minister-broker" had him in Oppenheimer funds carrying a 5.75% front-load--- in a 403b. That's just criminal, though (apparently) it is perfectly legal. Now he's in no-load TRP. No financial literacy in schools very often leaves the average guy and gal at the mercy of predators--- ordained or not. Outrageous. He'll have a rare traditional defined-benefit pension to go along with his 403b, and hers. He's lucky, that way. But he was being robbed.

Judging from the above comments, the components of a 403(b) must depend upon the individual school district.

(Shooting from 20 or 30 year old memories here.)
- The 403 B preceded the 401 K by a number of years.
- The IRS 403 B provision was originally intended to allow certain public employees (including teachers) to shelter from taxes a portion of their pay in annuities. In my early years the plan was often referred to by colleagues as a TSA (Tax-Sheltered Annuity) as that was the original scope of these plans.
- At some point early on it was expanded to allow these employees to invest in mutual funds. (Employees had pushed for this.) Haven’t time to check, but either by adjucation or legislation that change occurred in the early 70s.
- OJ is correct (as pertains to where I worked and perhaps more generally). The school district or other employer had control of which fiduciary (and fee based advisor) could handle their workplace account. At first only one fund company was allowed where I worked; and there was a 4+% front load on everything. A few years later the employees organization pushed the employer to include no-load T. Rowe Price as a second option. With Price there were no restrictions as to which funds we might purchase.
- There was a convenient IRS loophole that lasted until at least the late 90s. It wasn’t widely known. It allowed employees to do 403 B transfers from the plan’s designated fiduciary to any other fund company of choosing while still working / contributing. The transfers could be partial. There was some basic paperwork, but no harder than moving an IRA from one custodian to another would be today.
- The above loophole was plugged (either by the regulatory authorities or legislation) sometime after 1998.

This is a bunch of BS. My wife has a 403(b) that is much more attractive than my 401(k).

FYI: How is it possible that two variations of tax-deferred retirement accounts, born of similar ideals and motivations, have evolved into shockingly different animals?
I refer to 401(k) and 403(b) investment accounts. Despite being part of similar tax codes with nearly identical goals, in practice the portfolios of each bear little resemblance to each other. As a result, millions of American teachers, among others, are retiring with less in savings than they deserve.
Regards,
Ted
https://www.bloomberg.com/opinion/articles/2019-03-15/teachers-deserve-better-from-retirement-plan-system

https://www.sec.gov/Archives/edgar/data/1444822/000119312519075970/d668829d497.htm
497 1 d668829d497.htm AQR FUNDS SUPPLEMENT
AQR FUNDS
Supplement dated March 15, 2019 (“Supplement”)
to the Class I Shares and Class N Shares Prospectus
and the Class R6 Shares Prospectus,
each dated May 1, 2018, as amended (the “Prospectuses”),
of the AQR Diversified Arbitrage Fund, AQR Equity Market Neutral Fund,
AQR Long-Short Equity Fund and AQR Multi-Strategy Alternative Fund
(the “Funds”)
This Supplement updates certain information contained in the Prospectuses. Please review this important information carefully. You may obtain copies of the Funds’ Prospectuses and Statement of Additional Information free of charge, upon request, by calling (866) 290-2688, or by writing to AQR Funds, P.O. Box 2248, Denver, CO 80201-2248.
Effective immediately, the AQR Diversified Arbitrage Fund, AQR Equity Market Neutral Fund, AQR Long-Short Equity Fund and AQR Multi-Strategy Alternative Fund are no longer closed to new investors. Accordingly, all references in the Funds’ Prospectuses to the AQR Diversified Arbitrage Fund, AQR Equity Market Neutral Fund, AQR Long-Short Equity Fund and AQR Multi-Strategy Alternative Fund being closed to new investors are hereby deleted in their entirety from the Prospectuses.
Please refer to the section entitled “Investing With the AQR Funds” beginning on page 171 of each Prospectus for a description of investors eligible to invest in the AQR Diversified Arbitrage Fund, AQR Equity Market Neutral Fund, AQR Long-Short Equity Fund and AQR Multi-Strategy Alternative Fund.
PLEASE RETAIN THIS SUPPLEMENT FOR YOUR FUTURE REFERENCE

Hi @ron
Navigator is indeed erratic. Only the top line for data entry box for "funds" begins to load a funds list; and the ETF entry box doesn't begin to populate a drop down list. This function does not always load any list.
My guess is that not many folks here now are aware of this MFO feature. Navigator is very useful to create a list of funds from ticker symbol inputs. Navigator may be found by clicking/selecting "Resources" in the green title bar, and then clicking/selecting "The Navigator" from the list of choices available.
For those who don't know about Navigator, this is an internal link.
In the beginning, this program was built by "Falcon", with the last pseudo name used, of "Accipiter".
@ron This is a discussion link about this situation from Oct., 2017.

Long known for its founder Dan Fuss' benchmark-agnostic approach to investing, this experienced team doesn't shy away from risk. Over time, sizable allocations to non-U.S.-dollar-denominated bonds and a large corporate stake, including junk-rated fare, have dominated the portfolio. At the same time, the portfolio's typically mid-single-digit common stock stake distinguishes it from the majority of its multisector bond Morningstar Category peers, while concentration in this stake adds idiosyncratic risk. For example, in late 2016 the portfolio's combined position in Intel (INTC) stock and an equity-sensitive convertible topped 8%. The team eventually sold that name but bought a 3% position in AT&T (T) common stock in late 2018's volatile markets, part of a 7% allocation to equities at year-end. The team cited that company's generous free cash flows, strong competitive position, and plump yield.

There's nothing 'outstanding' or special about the 2 non-Vanguard funds. At the very least their ERs (just over and just under 1.0 on very small AUM) are horrible and to be avoided by sane investors.
Must be a slow day at Barrons today.....

FYI: (This is a follow-up article.)
The Barron’s Income column has focused recently on the top-performing dividend funds over the past five years. It’s a way to get sense of which strategies and stocks have worked for equity income investing.
The first installment focused on the five top-performing ETFs over the past half-decade. The second featured the top five actively managed funds.
Continuing that theme, these are three more actively managed dividend-focused funds from the next tier of top performers: The Vanguard Dividend Growth (ticker: VDIGX), which is closed to new investors; the Bishop Street Dividend Value (BSLIX), and the Madison Dividend Income (BHBFX).
Regards,
Ted
https://www.barrons.com/articles/3-more-outstanding-funds-for-dividend-investors-51552573094?refsec=funds

@ron- A few questions...
1• Had this function worked OK prior to now?
2• If so, are you using the exact same equipment?
3• If 2 is "yes", have there been any recent changes to or upgrades of your software?
4• If 3 is "no", are you using the same internet service provider (ISP)?
5• If 4 is "yes", have there been any other changes in any other internet functions?
6• Are there any other MFO functions that are not operating properly?
Thanks- this information will be useful to the technical folks at MFO.

https://www.sec.gov/Archives/edgar/data/1016073/000119312519074437/d914053d497.htm
497 1 d914053d497.htm 497
DRIEHAUS MUTUAL FUNDS
(The “Trust”)
Driehaus Frontier Emerging Markets Fund
SUPPLEMENT DATED MARCH 14, 2019
TO PROSPECTUS, SUMMARY PROSPECTUS and
STATEMENT OF ADDITIONAL INFORMATION DATED APRIL 30, 2018
IMPORTANT NOTICE
The Board of Trustees of the Trust has determined to terminate and liquidate the Driehaus Frontier Emerging Markets Fund (the “Fund”). Shareholders who do not sell their shares of the Fund before the effective date under the Plan of Termination and Liquidation, currently expected to be April 29, 2019, will receive a liquidating distribution in cash equal to the amount of the net asset value of their shares. Thereafter, the Fund will be liquidated and dissolved, and all references to the Fund herein shall be removed.
Effective as of the close of business on March 21, 2019, the Fund is closed and will not accept any purchase orders. In connection with the termination of the Fund and as the Fund’s investment adviser deems appropriate, the Fund will begin the process of liquidating its portfolio securities and shareholders should be aware that the Fund will not be pursuing its stated investment objective or engaging in any business activities except for the purpose of winding up its affairs.
For taxable shareholders, the liquidating distribution will generally be treated as a redemption of shares and such shareholders may recognize a gain or loss for federal income tax purposes. Shareholders should consult with their tax advisors for information regarding all tax consequences applicable to investments in the Fund.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
For more information, please call the Driehaus Mutual Funds at 1-800-560-6111.

Thanks, but not original. At the time of the GFC (global financial crisis), people were referring to retirement accounts as 201(k)s.
See, e.g. Scott Burns, They Don't Call Them 201(k)s for Nothing, April 24,2009.
https://assetbuilder.com/knowledge-center/articles/they-dont-call-them-201k-s-for-nothing

@MFO Members: This morning at 4:16 AM as I do every day put together the Breakfast Briefing. The yields in Bonds from CNBC were from yesterday, 3/13/19, I simply updated the current yields at 8:10 AM.
Regards,
Ted

@msf: "361(k)s". Cute. :)

■ ■ ■ ■ ■ ■ ■ ■ THIS POST IS IN VIOLATION OF MFO POSTING STANDARDS ■ ■ ■ ■ ■ ■ ■ ■
⇒ This post had few views and no comments. It has been artificially "bumped" into the COMMENTS + CATEGORY by the poster himself, without legitimate qualifying comments.
He has deliberately done this with the spurious "CNBC Bond Market Update" comment so as to force it to your attention. He is well aware that this is in violation of MFO standard practice, but he believes himself to be exempt from such things, because he is the almighty TED.

Got to agree here. Perhaps they could have said simply: 401(k)s became 361(k)s in Q4 and leave it at that?
An important point that I think was virtually ignored is that 401(k) brokerage accounts are typically options within more traditional 401(k) plans of funds. Thus employees that use these brokerage accounts tend to be more aggressive investors - ones who believe they understand markets and can do better than with the choices already in their plans.
Such investors would naturally tend to lose more when markets swoon. So what?

What's the point here?
Global equities (MSCI ACWI) were down nearly 13% in the fourth quarter and almost 9.5% for the year.

FYI: (MFO Members how did you do ?)
Plan participants using a self-directed brokerage option in their 401(k)s had a brutal fourth quarter.
Retirement plan participants using self-directed brokerage accounts with Schwab lost on average more than 10 percent of their account balances during the fourth quarter of 2018, according to Charles Schwab’s SDBA Indicators Report. For the year, the average loss was about 6.3 percent.
Regards,
Ted
https://www.fa-mag.com/news/self-directed-401-k--participants-were-swamped-in-the-4th-quarter-43785.html?print