BPPG response - Options for Defined Benefit schemes - 19Apr24.pdf
DOL Fiduciary Rule Reallocation guide
1. Brinker Capital
reallocation guide
As the Department of Labor (DOL) Fiduciary Rule takes effect
in 2017, Brinker Capital embraces the opportunity for industry
clarity and transparency.
The rule is extensive and complex, requiring
comprehensive interpretation by organizations
across the industry.
For financial advisor use only
At the highest level, Brinker Capital is taking steps to
maintain compliance with the DOL Fiduciary Rule and
continue to serve our financial advisors and investors.
In April 2017, Brinker Capital will reallocate
Destinations mutual fund portfolios to a
series of institutional class sub-advised
multi-manager mutual funds.
Fiduciary oversight
Advise in the best interest
of investors
Fair and transparent fees
For 30 years, Brinker Capital has acknowledged our fiduciary
responsibility, in writing, under ERISA 3(38).
Since 1987, Brinker Capital has adhered to our multi-asset class
investment philosophy. This belief in the value of meaningful
diversification is the foundation for all of our investment solutions.
This includes risk-based models, income-oriented solutions and
absolute return strategies, all designed to help investors achieve
better outcomes based on their personal goals.
Brinker Capital will transition to a level fee structure that pro-
vides a simplified pricing schedule for our advice and service.
What Brinker Capital is doing?
Key elements of the
DOL Fiduciary Rule
The objectives and portfolio management team of all
of the Destinations portfolios remain unchanged. This
sub-advised mutual fund structure will provide a more
cost-effective solution for our investors with a level fee
structure that is aligned with the DOL Fiduciary Rule.
2. Destinations mutual funds
A 22-year history in a more cost-efficient structure.
Conservative
Moderately
Conservative
Moderate Aggressive
Moderately
Aggressive
Aggressive
Equity
RETURN
RISK
Defensive
Destinations portfolios cover a range of risk tolerances
and investment time horizons and the objectives and
portfolio management team remain unchanged. The
underlying investments will be reallocated to institutional
Destinations
Mutual Funds
Investment objective Benchmark
Target # of
sub-advisors
Large Cap Equity
Fund
Provides large cap US equity exposure across styles Russell 1000 Index 5-7
Small-Mid Cap
Equity Fund
Offers mid and small cap US equity exposure across styles Russell 2500 Index 3-5
International
Equity Fund
Provides all cap international equity exposure, including allocations to
developed, emerging and frontier markets
MSCI All Country
World Index ex USA
4-6
Equity Income Fund Provides exposure to equity-oriented income generating strategies S&P 500 Index 2-4
Real Assets Fund Offers exposure to real asset strategies MSCI World Index 1-4
Core Fixed
Income Fund
Provides stability, income and low correlation to equity-oriented asset classes,
multi-sector exposure, primarily investment grade and intermediate duration
Bloomberg Barclays
US Aggregate Index
2-3
Municipal Fixed
Income Fund
Provides stability, income and low correlation to equity-oriented asset classes,
multi-sector exposure, primarily investment grade and intermediate duration
BofA Merrill Lynch 1-10
Yr US Municipals Index
1-3
Low Duration
Fixed Income Fund
Provides stability, income and low correlation to equity-oriented
asset classes, but with less interest rate risk than core fixed income
BofA Merrill Lynch 1-3
Year Treasury Index
2-4
Global Fixed Income
Opportunities Fund
Complements a core fixed income allocation; includes allocations to extended
fixed income sectors like high yield, EMD, int’l fixed income and preferreds
Bloomberg Barclays
Universal Index
3-6
Multi-Strategy
Alternatives Fund
Offers a differentiated source of return, includes allocations to mulitple
absolute return and alternative strategies
HFRX Global Hedge
Fund Index
4-8
share class sub-advised mutual funds for increased
cost efficiency. Destinations mutual funds will be
utilized as the underlying components to construct
the same Destinations portfolios that exist today.
Domestic Equity
International Equity
Fixed Income
Absolute Return
Real Assets
Destinations range of risk-based portfolios utilizing Destinations mutual funds
Balanced
Income
As of December 31, 2016. For illustrative purposes only.
3. Destinations Moderate
Consistent portfolio execution in mutual fund format.
Target
Domestic Equity 42.36%
Destinations Large Cap Equity Fund 32.31%
BlackRock S&P 500 Index 10.99%
Columbia Focused Large Cap Growth 4.20%
T. Rowe Price Growth Stock 4.85%
Delaware Focused Large Cap Value 4.20%
TCW Relative Value Dividend Appreciation 4.85%
Fort Washington Large Cap Focused Equity 3.23%
Destinations Small-Mid Cap Equity Fund 8.50%
Ceredex Mid Cap Value 3.40%
iShares Core S&P Mid Cap ETF 1.53%
Driehaus Micro Cap Growth 1.36%
LMCG Small Cap Value 1.36%
iShares Core S&P Small Cap ETF 0.85%
Destinations Equity Income Fund 1.55%
Columbia Dividend Opportunity 0.59%
Federated Strategic Value Dividend 0.59%
iShares Core High Dividend ETF 0.37%
International Equity 12.54%
Destinations International Equity Fund 12.54%
MFS International Value 2.51%
T. Rowe Price International Growth 3.01%
iShares Core MSCI EAFE ETF 2.13%
Wasatch International Micro Cap 2.26%
Baron Emerging Markets 1.50%
iShares Core MSCI Emerging Markets ETF 1.13%
Fixed Income 28.26%
Destinations Core Fixed Income Fund 20.48%
DoubleLine Total Return Tactical 12.29%
BlackRock US Aggregate Index 8.19%
Destinations Low Duration Fixed Income Fund 1.24%
CrossingBridge Low Duration High Yield 0.56%
DoubleLine Low Duration 0.37%
iShares Core 1-5 Yr USD Bond ETF 0.31%
Destinations Global Fixed Income Opp Fund 6.54%
CrossingBridge Corporate Credit 3.27%
DoubleLine Low Duration Emerging Markets 2.22%
Nuveen Preferred Securities Opportunities 1.05%
Real Assets 2.60%
Destinations Real Assets Fund 2.60%
SailingStone Global Natural Resources 1.82%
iShares Core US REIT 0.78%
Absolute Return 13.15%
Destinations Multi Strategy Alternatives Fund 13.15%
RiverNorth Opportunities 3.29%
Driehaus Active Income 3.16%
JPMorgan Strategic Income Opportunities 1.58%
Driehaus Event Driven 1.84%
Legg Mason BW Absolute Return Opportunities 0.66%
Avenue Credit Strategies 2.63%
Expected mutual fund portfolio holdings
(0%-25%)
Target
Domestic Equity 42.36%
Large Cap 32.31%
Fidelity 500 Index Fund 4.73%
Columbia Select Large Cap Growth 5.49%
T. Rowe Price Growth Stock 6.20%
Delaware Value 5.96%
TCW Relative Value Dividend Appreciation 6.45%
Touchstone Focused Equity 3.47%
Small/Mid Cap 8.50%
RidgeWorth Ceredex Mid Cap Value 4.49%
Driehaus Micro Cap Growth 1.92%
Touchstone Small Cap Value 2.09%
Equity Income 1.55%
Columbia Dividend Opportunity 1.55%
International Equity 12.54%
International Equity 12.54%
MFS International Value 3.67%
T. Rowe Price International Stock 3.23%
Wasatch International Opportunities 2.97%
Baron Emerging Markets 1.69%
Wasatch Frontier Emerging Small Countries 0.99%
Fixed Income 30.87%
Core Fixed Income 20.48%
DoubleLine Total Return 11.87%
Dreyfus Bond Market Index 8.61%
Low Duration Fixed Income 1.24%
RiverPark Short Term High Yield 1.24%
Credit Fixed Income 9.15%
RiverPark Strategic Income 3.81%
DoubleLine Low Duration Emerging Markets 2.72%
Avenue Credit Strategies 2.61%
Real Assets 2.60%
Real Assets 2.60%
Victory Global Natural Resources 2.60%
Absolute Return 10.54%
Multi Strategy Alternatives 10.54%
RiverNorth Core Opportunity 3.33%
Driehaus Active Income 2.71%
JPMorgan Strategic Income Opportunities 1.76%
Driehaus Event Driven 1.76%
Legg Mason BW Absolute Return Opportunities 0.98%
Current portfolio holdings (12/31/16)
Cash allocation of 1.07% is not included in current portfolio holdings. Holdings are as of 12/31/16 and are subject to change at any time.
The Destinations Moderate mutual fund portfolio
will retain the same overview, objective and
asset allocation, as well as many of the same
underlying positions as the existing portfolio.
Portfolio overview
Long-term growth of capital with moderate volatility
Strategic target of 60% growth and 40% stable assets
5+ year investment time horizon
Blend of active and passive investment management
4. Destinations portfolio (Q) Current Expected
Aggressive Equity 1.08% 0.96%
Aggressive 1.10% 0.99%
Moderately Aggressive 1.08% 0.99%
Moderate 1.05% 0.99%
Balanced Income 1.03% 0.98%
Moderately Conservative 0.95% 0.97%
Conservative 0.90% 0.97%
Defensive 0.88% 0.95%
Service and support
The same exemplary service and support you’ve come to expect from us.
Fees
One pricing schedule for our advice and service.
BrinkerCapital.com
1055 Westlakes Drive, Suite 250
Berwyn, PA 19312
800.333.4573
Connect With Us:
Dedicated sales support
and client service teams
Assets Current New* (tiered)
$10,000-$50,000 0.55% 0.25%
$50,000-$100,000 0.35% 0.25%
$100,000 to $1 million 0.25% 0.11%
Next $1 million 0.25% 0.06%
Next $1 million 0.25% 0.01%
Over $3 million 0.25% 0.00%
Sales and
marketing materials
Client reporting
Sample Client
Sample Client IRA
Sample Client IRA - Unmanaged Assets
123456789
123456789
Quarterly commentary
and market updates
At Brinker Capital, we remain commited to
serving the needs of financial advisors and investors.
great ideas + strong discipline = better outcomesTM
For financial advisor use only. Brinker Capital Inc., a Registered Investment Advisor.
Brinker Capital feesDestinations internal expense ratios
*New fee structure will be effective beginning April 1, 2017. Destinations mutual
funds will have a 0.39% investment management fee paid to Brinker Capital.
The new Brinker Capital fee listed above will be offset by this management fee
at each breakpoint. This complies with the DOL Fiduciary Rule as this is an offset
between account level advisory fee and fund level management fee.
Minimum account size for the Destinations mutual funds
has been lowered to $10,000 to provide multi-asset class,
risk-based portfolios for smaller investor accounts.
DSA_GUIDE 02/17