BOSTON (TheStreet) -- With the intent of giving investment managers a more transparent look at the funds within 401(k) plans, BrightScope, an independent provider of retirement plan ratings, announced Monday that it will offer fund distribution data and rankings for the 401(k) and defined-contribution industry.

BrightScope's database includes a detailed investment menu on more than 50,000 plans, representing nearly 90% of all the assets in 401(k)s.

"For years, the 401(k) industry has operated without comprehensive data on which funds and managers have the best distribution," says Mike Alfred, CEO and co-founder of BrightScope.

BrightScope's ranking of the top funds in the 401(k) marketplace by total distribution include: American Funds Growth Fund of America, Pimco Total Return, American Funds EuroPacific Growth, SSgA S&P 500 Index, Vanguard 500 Index, Fidelity Contrafund, Fidelity Diversified International, Vanguard Institutional Index, Fidelity Spartan 500 Index and Dodge & Cox Stock.

Alfred says the goal was to use audited financial data on investment funds held within 401(k) plans, providing an alternative to the industry's typical survey-based approach.

When surveys are done, they usually capture no more than 10% of total distribution and skew heavily toward funds prominent in the survey company's client base, he says. Improved data can give investment managers a better view into their own fund distribution, as well as the distribution of their competitors.

"When most people think of 401k plans they think of funds, and the large investment managers in the space are the ones that have the biggest monetary incentive to make changes to the menus because they are getting paid billions to have their funds in these plans," Alfred says. "One way to make this market more efficient is to give better visibility, not just to the general marketplace, but specifically to the investment managers who are spending tens of millions of dollars a year on marketing costs to sort of inefficiently go about marketing their funds to clients, sponsors, financial advisers and all of the people who really control the marketplace."

Alfred says "data lag" was among the reasons this information, culled from audited plan financials kept by the Department of Labor, has not traditionally been seen as very valuable. The DOL, however, has streamlined how its plan data are collected and distributed, and a more up-to-the-date analysis is now possible.

"Were directly scraping end-of-year 2009 data now," he says.

As for the list itself, Alfred says it was no surprise to see that the top funds were from investment providers that also do record keeping.

"The bundled providers for the plans and companies like Fidelity and Vanguard are dominant," Alfred says. "Because they are the recordkeeper, they deal with the plan sponsor directly and often garner the largest percentage of the assets. That is something we expected. What we didn't expect to see was how many providers that don't do recordkeeping -- such as Pimco and American Funds -- still showed up on the list."

Alfred says it was also interesting to see four index funds make the cut of their top 10, something that would have been unlikely a decade ago.

"That is because of the momentum Vanguard has in the marketplace from positioning themselves strategically away from active management," he says. "A lot more people are now disciples of that philosophy."

-- Written by Joe Mont in Boston.

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