For CEOs & CFOs Reviewing Their 401(k)
IPS Strategic Capital serves as a discretionary §3(38) investment manager to corporate retirement plans — rebuilding your fund lineup with ETFs, modernizing your plan document to allow options-based risk transfer, and giving your employees an institutional-grade portfolio they can actually understand.
The Status Quo
of new 401(k) contributions flow into target-date funds — a single glide path priced on backward-looking mean-variance assumptions that broke in 2008, 2020, and 2022.
The Plan Sponsor Reality
Most corporate 401(k) menus were assembled by a recordkeeper or broker, defaulted to target-date funds, and haven’t been re-evaluated in years. Under ERISA, that’s your exposure — not theirs.
Plan documents typically exclude ETFs entirely, blocking access to lower fees, intraday liquidity, and tax efficiency.
Target-date funds reduce every employee to a birthday — ignoring liabilities, taxes, equity comp, and real risk tolerance.
Mean-variance optimization uses past returns to predict future covariance. Correlations break exactly when participants need them to hold.
Revenue-sharing share classes and undisclosed compensation create benchmarking gaps that ERISA §408(b)(2) requires you to monitor.
The Fiduciary Difference
As an ERISA §3(38) Investment Manager, IPS accepts discretionary fiduciary responsibility for fund selection, monitoring, and replacement. The legal liability for those investment decisions moves from your committee to our firm.
Full discretion. Full liability.
Under ERISA §3(38), a plan sponsor that delegates to a qualified investment manager is relieved of fiduciary responsibility for investment decisions — provided the delegation itself is prudent. We accept that delegation in writing.
Your investment committee stops being the last line of defense on every fund decision. We document the process, run the quantitative screens, replace funds when they breach our policy, and present a quarterly fiduciary file your DOL examiner will recognize.
You retain oversight. We carry the investment decision-making — and the prudence documentation behind it.
What We Do
We replace the recordkeeper-default lineup with an institutional menu, change the plan document to allow modern instruments, and stand behind the platform with proactive employee education.
We rebuild your menu from the ground up using transparent, low-cost ETFs across every major sleeve.
Most plan documents prohibit ETFs and options. We coordinate with your ERISA counsel and recordkeeper to amend the document so the platform can actually be built.
We layer options-based hedges over the core ETF allocation to engineer covariance stability — not just estimate it from backward-looking data.
Five pre-built model portfolios — from conservative income to aggressive growth — each engineered for covariance stability, not just historical efficiency.
Quarterly lunch-and-learns delivered on site or virtually. We explain the menu, the risk models, and the math — in language an employee can act on.
Quarterly fiduciary file delivered to the CFO and investment committee. Designed to survive a DOL audit and to show participation, performance, and progress in one place.
The IPS Difference
Traditional 401(k) lineups rely on the assumption that asset classes will stay diversified. That assumption fails in macro stress. IPS replaces the statistical hope with an explicit option contract — what we call hard insurance.
The result is a portfolio that behaves predictably when the market does not. For your participants, that’s the difference between watching their balance disappear in a drawdown and arriving at retirement on plan.
| Typical 401(k) | IPS Platform | |
|---|---|---|
| Downside protection | Statistical | Contractual |
| Behavior in stress | Correlation-dependent | Engineered |
| Vehicle type | Mutual funds | ETFs |
| Fund selection liability | Plan sponsor | 3(38) IPS |
| Allocation models | One TDF glide path | 5 risk-tier models |
| Employee education | Enrollment kit | Quarterly on-site |
What Plan Sponsors See
Illustrative outcomes from comparable plan engagements. Actual results vary by plan size, prior lineup, and recordkeeper structure.
Typical all-in expense ratio reduction after migrating from active mutual funds to a screened ETF lineup with revenue-sharing eliminated.
Discretionary delegation transfers investment liability for the platform from the sponsor’s committee to IPS Strategic Capital, in writing.
Average enrollment increase after on-site education and risk-tier model rollout in our representative engagements.
Built for the C-Suite
For the CEO
For the CFO
How an Engagement Runs
We review your current Form 5500, fund lineup, fee disclosure, and plan document. You receive a written diagnostic — no obligation.
Execute the 3(38) agreement and adopt a written Investment Policy Statement. Committee training included.
Coordinate plan-document amendment, recordkeeper conversion, and lineup transition. Employee communication runs in parallel.
Quarterly monitoring, fiduciary file, committee reporting, and on-site employee education. Annual fee & benchmark audit.
Start Here
A 30-minute conversation and a one-page written diagnostic of your current 401(k) — fee benchmarking, fund-lineup review, and fiduciary-process gap analysis. No obligation. Privileged and confidential.
Direct Line(XXX) XXX-XXXX · plansponsor@ipsstrategiccapital.com
