For decades, ETFs and 401(k) plans circled each other like dance partners kept apart by a velvet rope — plenty of chemistry, but the recordkeeping fine print never let ETFs onto the floor. Now the rope’s down. A pair of recent SEC rulings lets asset managers pour mutual funds and ETFs from the same pitcher, a structure Vanguard alone held the keys to for twenty years — now BlackRock, State Street, and JPMorgan have copies too. The timing tracks: ETFs have swelled past 4,300, pulling in $2.4 trillion in 2025 while mutual funds bled $700 billion out the other side.Collective investment trusts, the quiet workhorses of the DC market, are about to feel a faster horse in the next lane. CITs carry real weight but stay tethered — hard to compare, and locked out of IRAs entirely. So when roughly $1 trillion rolls out of 401(k)s into IRAs each year, CIT investors hit a wall their ETF counterparts just walk through. Dual-class funds don’t just widen the road for plan sponsors and advisors — they hand participants a passport that works at the border, too.
Read more insights in “Dual-Class ETFs, Mutual Funds Could Reshape 401(k) Landscape” on WealthManagement.com.
