The Race for Retirement Shelf Space May AlreadyBe Over
By: Bill Katz, Jaret Seiberg, Cherilyn Radbourne, Graham Ryding, Bradley Hays
Jul. 17, 2025 - 2 minutes
Overview:
- While the U.S. and Canadian retirement markets seem poised to add alternative allocations, our work suggests the race for shelf space may already be over.
- We foresee upwards of US$5 trillion in potential "money in motion" boding best for pure-play alts managers, but it's likely skewed towards larger/solutions/income-oriented platforms.
- Leveraging the TD Cowen proprietary Washington Research Group, we see accelerating adoption potential into the second half of 2026.
- We introduce three vectors for success: Allocations, Alliances and Access.
The TD Cowen Insight
We foresee upwards of US$5 trillion in potential "money in motion" boding best for pure-play alts managers, but it's likely skewed towards larger/solutions/income-oriented platforms.
Our Thesis
We see the confluence of inexorable forces making it inevitable that the U.S. and Canadian retirement market will increasingly embrace alternatives:
- demographics,
- broadening democratization,
- mixed funding dynamics,
- strategic alliances and
- shifting regulatory framework[s].
To date, the largest gating factor is litigation risk, yet we see those barriers beginning to fall into the second half of 2025 and beyond.
What is Proprietary?
We collaborate with our Canadian counterparts and the TD Cowen Washington Research Group to harmonize our views across geographies and navigate the regulatory and legislative landscapes. Our work draws on intensive examinations around market and product evolution, ranking key success factors and screening across three key vectors: Allocations, Alliances and Access. We argue scale, brand and solutions will win making it difficult for smaller, less differentiated players to "catch up".
We also address key issues, such as:
- liquidity constraints,
- pricing and net asset value (NAV),
- performance and
- litigation.
Financial and Industry Model Implications
Examining the U.S. Defined Benefit (DB) market, Exchange-Traded Funds (ETF) and Money Markets segments, along with Australia's Superannuation model, we believe alternative allocations could range from 5% to 15% longer term. Every 5% reallocation toward Alts adds approximately US$1.5 trillion in assets under management (AUM). By our math, we believe the U.S. retirement segment could offer approximately US$40 billion in additional revenues, likely at high incremental margins
What to Watch
- Regulatory and legal timelines (we detail key milestones through 2026),
- Ongoing strategic alliances as the industry jockeys for increasingly narrow shelf space and related execution risks as premium relationships already well underway and
- further product evolution/disclosure on Public and Private mandates.
Subscribing clients can read the full report, The Race For Retirement Shelf Space May Already Be Over – Ahead Of The Curve, on the TD One Portal
Senior Analyst, Asset Managers, Brokers & Exchanges, TD Cowen
Senior Analyst, Asset Managers, Brokers & Exchanges, TD Cowen
Managing Director, Washington Research Group - Financial Services Policy Analyst, TD Cowen
Managing Director, Washington Research Group - Financial Services Policy Analyst, TD Cowen
Managing Director, Equity Research, TD Cowen
Managing Director, Equity Research, TD Cowen
