RPA 2

(Updated January 2025)

This course imparts the essential elements of portfolio theory and asset allocation when overseeing or delegating responsibilities for retirement plan investment management. The course explores the necessity for mitigating risk through diversification when pursuing superior asset returns. Topics include today’s generally accepted investment theories and the necessity for plan sponsors to formulate workable investment policy statements based on these sound investing principles. A study of the historical returns and risk dispersions of various asset classes over multiple time horizons provide a context from which to develop portfolio policies and investment strategies. Whether active or passive investment strategies should be pursued, and how insights from behavioral finance can enhance plan design and participant decision-making are covered topics. The course further delves into the use of investment managers and other service providers and how a fiduciary monitors the ongoing performance of these plan intermediaries. Varied investment products such as index funds, target-date funds (TDFs), and exchange traded funds (ETFs) are explained and evaluated. 

The course investigates all of these critical investment issues using a fiduciary perspective and highlights the importance of prudence and the high ethical standards demanded of plan sponsors in serving the interests of participants and their beneficiaries under an ERISA-qualified plan. The course incorporates both currently applicable law and future, to-be-phased-in requirements from the SECURE 2.0 Act.

Topics Covered:

• Retirement Plan Investing
• Balancing Risk and Return
• Portfolio Theory
• Investment Managers and Plan Intermediaries
• Active and Passive Investment Strategies
• Insights From Behavioral Finance
• Target-Date and Life Cycle Funds
• Hybrid Retirement Plan Approaches
• Plan Sponsor Administrative Responsibilities
• Participant Services
• Fiduciary Oversight and Plan Governance