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August 4, 2022  |  8 Minutes Read


Quarterly Snapshot


Target date fund flows for the quarter were more pronounced compared to the previous quarter, while traditional plan participants sought lower market volatility in money market funds during challenging market conditions. Year-to-date active manager outperformance opportunities have been in US equities, specifically in large cap value, small cap value and small cap growth.



Net Target Date Fund Investment Flows


Source: Strategic Insight, Simfund as of June 30, 2022; For open-end mutual funds only.



Net New Investment Flows


Source: ICI “The U.S. Retirement Market, First Quarter 2022,” released June 2022.



Asset Class Performance


Source: Morningstar, as of June 30, 2022. Performance is annualized for periods greater than one year. Past performance does not guarantee future results, which may vary.



Active Management Performance


Source: Morningstar, as of June 30, 2022. Net of fees.




In Focus: Crypto Assets


Crypto assets have captured the attention of many defined contribution industry stakeholders in light of recent regulation, litigation and product innovation. This quarter, In Focus aims to provide an overview of the crypto asset conversations taking place in DC plans. 



Defining Cryptocurrencies 


What are currencies?

Efficient modes of exchange, units of account, and stores of value that are typically backed by a government


What are cryptocurrencies?

Digitally native assets with similar characteristics to those of currencies but designed to secure and store transactions cryptographically without reliance on a centralized administrator 


Why are they needed?

To allow for participation in a blockchain ecosystem


What are blockchains?

A unique type of database that enables the decentralized, digital transfer of value 


Source: Goldman Sachs Asset Management as of May 31, 2022.





Ownership and utilization of cryptocurrencies based on third-party survey data:

  • 25 million households with investable assets are investing in cryptocurrency (this represents 22% of households in 2021).
  • 66% of cryptocurrency investors are using it to trade, 22% of investors are using it for payments (and 12% are doing both). 


Source: Hearts & Wallets Research.


Market Cap


Bitcoin and Ether represent the majority of market cap of crypto assets


Source: CoinMarketCap as of July  14, 2022. 



Cryptocurrency Owners


Source: Hearts & Wallets Research.



Risk & Potential Return


The below charts provide information on Bitcoin’s historical performance, volatility and S&P 500 correlation. 






Source: Bloomberg and Goldman Sachs Asset Management as of June 30, 2022. Any reference to a specific company or security does not constitute a recommendation to buy, sell, hold or directly invest in the company; or its securities. Past performance does not guarantee future results, which may vary.


Asset Volatility Comparison



Source: Bloomberg and Goldman Sachs Asset Management as of May 31, 2022.



Historical Market Correlation



Source: Bloomberg and Goldman Sachs Asset Management as of May 31, 2022. Reflects Bear Market period of February 19, 2020–March 23, 2020. For illustrative purposes only.

Past performance does not guarantee future results, which may vary. Any reference to a specific company or security does not constitute a recommendation to buy, sell, hold or directly invest in the company or its securities.



Incorporation in DC Plans


The use of cryptocurrencies and digital assets for retirement plans has been called into question, and conversations are taking place among a variety of stakeholders, including regulators and product innovators.





Spotlight on Product Innovation




  • In April 2022, Fidelity announced plans to create a Digital Assets Account for 401k plans, with plans to launch in the summer
    Participants will be able to invest up to 20% of their balance in bitcoin as part of the core menu
    It is up to the plan sponsor to elect to make this offering available to participants




  • ForUsAll has announced plans to add cryptocurrency to its 401k platform, which is expected to launch this summer
  • Participants will be able to allocate up to 5% of their portfolios to more than 50 cryptocurrencies via Coinbase
  • Will be offered as an in-plan brokerage window
  • ForUsAll has indicated that it provides financial disclosures to participants and requires investors to pass an interactive quiz before accessing the window



Government Accountability Office (GAO)

June 2022: The GAO is asked to study crypto in retirement plans and their oversight. House Ways and Means Chairman Neal asked the federal watchdog to look into the issue, including how plans would administer the options, including valuation, fees and fiduciary safeguards for participants.




June 2022: Plan provider ForUsAll sued the DOL over its March 2022 guidance. It claims the DOL is violating the Administrative Procedures Act and overstepping its authority by attempting to institute what amounts to a ban on cryptocurrencies with a notice-and-comment rulemaking process.



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Defined Contribution Quarterly 3Q 2022: Crypto Assets

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The views expressed herein are as of 8/2/2022 and subject to change in the future. Individual portfolio management teams for Goldman Sachs Asset Management may have views and opinions and/or make investment decisions that, in certain instances, may not always be consistent with the views and opinions expressed herein.

Views and opinions expressed are for informational purposes only and do not constitute a recommendation by Goldman Sachs Asset Management to buy, sell, or hold any security, they should not be construed as investment advice.

Risk Considerations:

Buying, selling and using cryptocurrencies carry numerous risks.  Digital currency is not legal tender. No law requires companies or individuals to accept cryptocurrencies as a form of payment. Instead, cryptocurrencies use is limited to businesses and individuals that are willing to accept them. If no one accepts them, cryptocurrencies will become worthless. Cryptocurrency payments are irreversible.

Platforms that buy and sell cryptocurrencies can be hacked, and some have failed. In addition, like the platforms themselves, digital wallets can be hacked. As a result, consumers can—and have—lost money.

Cryptocurrency transactions can be subject to fraud and theft. Unlike US banks and credit unions that provide certain guarantees of safety to depositors, there are no such safeguards provided to digital wallets.


Past performance does not guarantee future results, which may vary. The value of investments and the income derived from investments will fluctuate and can go down as well as up. A loss of principal may occur.


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Index Benchmarks

Indices are unmanaged. The figures for the index reflect the reinvestment of all income or dividends, as applicable, but do not reflect the deduction of any fees or expenses which would reduce returns. Investors cannot invest directly in indices. The indices referenced herein have been selected because they are well known, easily recognized by investors, and reflect those indices that the Investment Manager believes, in part based on industry practice, provide a suitable benchmark against which to evaluate the investment or broader market described herein.

This information discusses general market activity, industry or sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment advice. This material has been prepared by Goldman Sachs Asset Management and is not financial research nor a product of Goldman Sachs Global Investment Research (GIR). It was not prepared in compliance with applicable provisions of law designed to promote the independence of financial analysis and is not subject to a prohibition on trading following the distribution of financial research. The views and opinions expressed may differ from those of Goldman Sachs Global Investment Research or other departments or divisions of Goldman Sachs and its affiliates. Investors are urged to consult with their financial advisors before buying or selling any securities. This information may not be current and Goldman Sachs Asset Management has no obligation to provide any updates or changes.

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Date of First Use: 8/4/2022. 286570-OTU-1647468


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