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The Short Answer

A Low-Cost Investment Option for Some 401(k) Savers

Collective investment trusts aren't available outside of plans but can offer fund-like performance at a lower price.

Question: My employer offers collective investment trusts as part of our 401(k) plan, but I don't understand if these are mutual funds or what. Can you explain?

Answer: Collective investment trusts, or CITs, are similar in many ways to mutual funds, and in some cases are even operated by mutual fund companies. But there are some important differences that you should be aware of before investing in them.