Morningstar acquires RightPond, data analytics provider on defined contribution and defined benefit plans

The acquisition comes as the entire industry is waiting for the Department of Labor to release the final ruling on its fiduciary standard

Mar 31, 2016 @ 5:45 pm

By Alessandra Malito

Morningstar has acquired RequiSight, also known as RightPond, a provider of data on defined contribution and defined benefit data, it announced in a press release.

Using RightPond, advisers and investors will see how money in retirement plans is invested. Morningstar will pair this data with its performance and attribute data, to give advisers a broader picture of where they can invest their clients' assets and what are the best recommendations to make for their clients. Firms will also be able to compare themselves to other firms.

Terms of the deal were not disclosed.

RightPond looks at data on plans that include corporate retirement plans, pensions, health and welfare plans, public pension funds, foundations, endowments and other institutional investors.

The acquisition comes at a time when the entire industry is waiting for the Department of Labor to release the final ruling on its fiduciary standard, which would require all advisers to act in their clients' best interest on retirement accounts. It is expected in early April.

Scott Burns, head of asset management solutions for Morningstar, said it helps advisers understand if moving their clients' assets from 401(k) plans to individual retirement accounts is the right move.

"The problem advisers have now is they can't see what a lot of these plans have easily, so it is a very manual process," Mr. Burns said. "It relies on surveying clients, which is not always the best way to find information, especially in the fiduciary world."

RightPond is familiar with this issue — the Department of Labor has worked with the company to find plan sponsors that were not satisfying the metrics in the proposed legislation, said Lawrence Johnson, chief executive of RightPond.

"There is a slice of the industry that has to reinvent itself," Mr. Johnson said. "It will impact thousands of advisers and shift billions of dollars of investments to different players."

RightPond uses data from the DOL's Form 5500, which is the information every plan sponsor files with the department. Mr. Burns said this acquisition harnesses technology the company can use down the line.

RightPond will continue as a standalone platform until it is integrated into Morningstar Data, eventually assuming the name of the acquirer. Eventually it will feed into the data flagship platform, Morningstar Direct, Mr. Burns said.

"We are getting not just the great retirement data, but data capability that will be able to declutter other investment data that has been a stumbling block for us in the past," Mr. Burns said.


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