401 (k) Retirement Plans (Technology)

Founded in 2010, RiXtrema s software helps advisors use cutting edge quantitative finance to optimize retirement portfolios and follow fiduciary best practice s. Key products are: 401kFiduciaryOptimizer – the software for advisors who work with ERISA retirement plans to optimize fees, quality and diversification of menu line ups; and IRAFiduciaryOptimizer – best interest reporting for the DOL Fiduciary Rule called the most comprehensive solution (Bob Veres, Advisor Perspectives, 1/23/17). Long used by institutional managers, RiXtrema introduced its risk management tools to the financial advisory and broker/dealer community to help ensure that clients get the analysis and advice they need. RiXtremas research team received the prestigious 2015 Peter L. Bernstein award for its article Risk Estimation and Hedging: A Reverse Stress Testing Approach, The Journal of Derivatives, April 2015.



The 401kFiduciary Optimizer, (launched April 2016), is the first and only software to use sophisticated quantitative methodologies to improve menu design for retirement plans enabling advisors to bring science-based savings and improved menu diversification to retirement plan sponsors and their participants. Embraced by more than 100 firms, the tool has helped more than 500 advisors identify significant savings for their plan sponsor clients and for plan participants. The y have also used the tool for business development, showing prospective clients how changing the plan menu can save money.

To provide further evidence of potential cost savings, we expanded our initial research on fee inefficiency. Applying the same algorithms used in the 401kFiduciary Optimizer, our award winning research team recently under took an enhanced analysis of 52,529 retirement plans from the DOL EFAST database, to estimate the potential aggregate savings to the defined contribution plans by switching to more efficient menus.

We considered only high-quality funds as low-fee alternatives to the universe of expensive incumbent funds. Further, only funds with a better ten-year track record than the incumbent funds were considered as replacements to obtain the saving s. A conservative estimate is that plan participants could save on average 25 bas is points by switching to lower cost investments that are quantitatively very similar to tho se they already hold, but with a better track record. Similarity is defined as a combination of category filters, together with historical and forward-looking predicted-correlation based on a multi-factor model. With total defined contribution plan assets of $6.8 trillion (as of March 2015), the potential aggregate savings is at least $17 billion – a powerful motivation for even more advisors to embrace the 401kFiduciaryOptimizer.

Category Finalists

Key Business Leader

Daniel Satchkov
CFA & President

Browse All Finalists