This article continues the discussion of the DOL’s Performance Benchmark factor by reviewing the second example of the application of that factor. As background, the DOL’s proposed regulation on selecting investments, including alternative assets, 2026-06178.pdf, identifies six factors that should be considered in the process of selecting any investments for participant-directed plans, such as 401(k) plans and private sector 403(b) plans. The six factors are: Performance, Fees, Liquidity, Valuation, Performance Benchmark, and Complexity. The proposal describes each of those factors and provides 20 examples of their application. In earlier posts, I covered three of the factors—Performance, Fees and Complexity, and their examples. My last post, Alternative Assets (19), discussed the first example under the Performance Benchmark factor.  Here is the DOL’s second example of the application of that factor: (2) Example. Custom composite benchmark; Private equity sleeve— (i) Facts. The named fiduciary of a participant-directed individual account plan selects as a designated investment alternative an asset allocation fund, which is registered under the Investment Company Act of 1940, that contains a private equity sleeve in addition to publicly traded stocks and bonds. In making this selection, the named fiduciary prudently enlists the assistance of an investment advice fiduciary within the