Chartwell Views

We invite you to review some of the articles written by Chartwell professionals on specific investment topics of interest to current clients. 

How to Weather a Bear Market

Defined contribution (DC) plans have not been immune to the many challenges created by the coronavirus pandemic.  DC plans are somewhat unique in that plan sponsors do not control participants’ asset allocation.  Yet, participants often have questions and concerns regarding market downturns and in the current environment, the availability of potentially accessing their account balances through loans and hardship withdrawals.  This Chartwell Views piece offers educational information and perspective that might be helpful to participants in addressing concerns about managing their accounts through a bear market. 

Weathering a Bear Market (pdf)



On March 27th, Congress passed, and President Trump signed, the Coronavirus Aid Relief and Economic Security (CARES) Act; a bipartisan response to the public health crisis and associated economic fallout in the wake of the COVID-19 virus.  In this issue of Chartwell Views, we provide a summary of the key provisions related to defined contribution and defined benefit plans, as well as health savings accounts (HSAs) and student loans.  Plan sponsors should assess the impact of the CARES Act provisions on their plan and specific situation.  

The CARES Act (pdf)



The most significant piece of retirement legislation in more than a decade, the SECURE (Setting Every Community Up for Retirement Enhancement) Act was signed into law on December 19, 2019.  Many of the changes focus on defined contribution plans, but a number of provisions also affect defined benefit plans, IRAs and 529 plans.  This Chartwell Views piece summarizes the most significant SECURE ACT changes. Many of the provisions of the SECURE Act became effective as of the date the Act was signed into law.  Implementation of other provisions are dependent up the start of the plan’s year, or the employer’s tax year beginning after December 31, 2019.   Recordkeepers/administrators are working on updating their systems to incorporate changes and are reaching out to clients to make them aware of the impact it will have on plans.  Plan sponsors should meet with their recordkeepers/administrators to specifically review the impact the Act will have on their plans and amending plan documents accordingly.

The SECURE Act (pdf)


Demystifying ESG & Responsible Investing

Investors today are giving greater thought to how they can align their investments with their values. With the array of acronyms (ESG, RI, SRI, BRI) and terminology (impact investing, green investing) out there, this space can be confusing to navigate. This paper seeks to discuss the history and evolution of the ESG/Responsible Investing space, clarify the three main approaches to investing within this space (SRI, ESG Integration, and Impact Investing), and help the plan sponsor decide which approach is best suited for their plan.

Demystifying ESG and Responsible Investing (pdf)


Exploring Global Real Estate Indices


Selecting an appropriate internal benchmark is a challenge for active and passive managers, and their investors. Investment strategies within the same asset class can differ considerably in terms of market capitalization ranges, sector and/or country allocation, and other metrics (profitability, earnings, quality/investment grades). Additionally, the number of indices has multiplied in recent years, providing each asset class with numerous benchmarking options. It is important for managers to select benchmarks which most closely represent (or correlate) with their portfolios and for investors to use appropriate benchmarks for performance evaluation purposes. 

Exploring Global Real Estate Indices (pdf)



Annually, PLANSPONSOR magazine conducts a survey of the US defined contribution plan marketplace.  In 2018, surveys were sent out to plans of all sizes covering a variety of industries, as well as nonprofit organizations (4,000 responses were received).   Chartwell Consulting has prepared a summary of the survey findings for the past 10 years.   Detailed summary results can be found on pages 4-7, along with comparisons to the prior year’s survey.   Highlights of the survey findings are provided on pages 1-3.  In the past two years, the survey has added more questions on plan costs, fees and fee structures, health savings accounts and financial wellness programs (see page 3).  Many of you have asked “what are other plans doing” and we hope sharing these industry trends is useful to you in structuring and managing your defined contribution plans.   

Chartwell VIEWS_2018 DC Survey (pdf)


Bear Market Perspectives


Equity markets closed 2018 with one of the weakest months of December on record.  From its high on September 20th, the S&P 500 touched on bear market territory (a decline of 20%) December 24th.  From that point, the market’s rebound/rally/bounce (time will tell which one we are in the midst of!) has been as swift and stunning as the decline.   As we wrote our 4th quarter Chartwell Review and prepare for year-end meetings, we collected some research on bear markets that might provide some reassuring perspective.

Bear Market Perspectives January 2019 (pdf)


Small Cap Indices Are Not Created Equal

As we have conducted index fund searches, we have been intrigued by the different performance outcomes we were finding amongst funds within the same asset class.  The differences were observable across all capitalization ranges and styles, but are most prominent in small cap equities.   What would cause a 2%-4% difference in the trailing annual returns for small cap index funds?   We wrote the attached paper to share our research on the topic.   Understanding the differences in the indices helps in both the selection of an appropriate index fund, and in appropriately benchmarking passive and active funds.  (September 2018)

Small Cap Indices are Not Created Equal (pdf)


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