To provide our clients with high quality tailored consulting and research, we need to know the financial services industry and our clients. To build lasting and profitable relationships, we dedicate ourselves to staying not just current on, but ahead of industry trends. This blog is intended to share our industry insights and, at the same time, to capture feedback from our readers.
At many asset management firms, the internal sales team acts as a de facto talent development pool, with top internals progressing not only to field wholesaling roles but also to roles in National Accounts, product development, and many other areas of the firm. Internal sales managers need to manage their teams to sell and service effectively, of course, but are often also tasked with hiring promising recruits and helping them grow their careers so they’ll want to stay with the firm.
Given this, effective engagement strategies are key. At kasina’s Internal & Hybrid Wholesaling Roundtable, held yesterday in New York, much of the discussion revolved around engagement – in other words, how to attract, develop, motivate and retain top talent. Here are 5 key engagement tips from the roundtable conversations:Start Early
Many teens and even college-age students... [read more]
Impending Rate Hikes
No one knows exactly when the Federal Reserve will begin to raise the Federal Funds rate. It’s crystal clear, nonetheless, that several rate increases of 25 basis points or higher will be necessary to bring the yield curve to historical norms and it’s more than likely to begin over the next 12 months. Financial advisors have begun preparing for that scenario by seeking alternative income assets, and most importantly, lowering the duration risk of their fixed income allocations. However, as we look at many actively managed multi-asset mutual funds, exposure to duration risk is still relatively high. Nowhere is that more evident than with target date (TD) funds, where the average target date fund has a 40-60% allocation to bonds, with a duration ranging from 4-6 years.Concern for Short Target Date Funds
We realize that the vast majority of target date retail clients generally have a long investment horizon,... [read more]
On Tuesday we hosted our annual RIA Roundtable. The morning’s discussion was kicked off with a presentation on the challenges and opportunities for building a deep presence with these advisors. As the number of RIAs and their assets continue to grow, more and more asset managers are recognizing this channel as an important opportunity for expanding their business footprint. However, the RIA channel is about as heterogeneous as it gets, meaning asset managers must be focused and precise in targeting advisory firms receptive to their products and services. Not all RIAs will be a good fit for an asset manager. There are three critical areas where asset managers must focus their effort to ensure they are a relevant player in this channel.Advisor Segmentation
It was clear during the roundtable that many firms are focusing their effort with advisors with $200M or more in assets. There were a few firms with a... [read more]
With the “free for all” auction of Russell Investments by the London Stock Exchange coming up, I thought that I would share a few observations from recent consulting engagements where we have advised asset management and insurance companies on potential mergers and acquisitions:Funds are Much More Than Their Performance
Often, a potential acquirer will get enamored with a target’s product line-up featuring a variety of strong performing, well rated funds. They will salivate over the prospect of making those products available to their sales force and dream about the new sales records that they will set. Unfortunately, these firms often neglect other critical product attributes – particularly capacity. It is critical to understand the upside (and limitations) fully before making an acquisition. A strong performing, but capacity-constrained product will not be nearly as profitable as one with significant room for growth. Our product consulting team always conducts in-depth analyses and... [read more]
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