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.

Millennials, Shark Tank and Silicon Valley

Discussions about the millennial generation having a true interest in Environmental, Social and Governance (ESG) and Socially Responsible Investing (SRI) philosophies have been coming up at conferences, in research and blogs – including a strong argument from our CEO Steven Miyao for the financial services industry to pay attention to the demand for such strategies. The prevailing wisdom is that millennials will demand more responsibility by the firms they invest in, and also the entities they invest through (i.e., advisors and asset managers). This is a break from the past where investors may generally like the spirit of it, but only to the point that it doesn’t interfere with performance. 

Millenials require corporate responsibility from their investments.

More Involvement with Their Investments

Without getting into the psychology and societal factors that drive the feeling that socially responsible investing is genuine among the next generation, I’d like to take a step in... [read more]

4 Reasons Why Client Retention is a High Impact Strategy

Client retention is as fundamental to business success as acquisition. But even though firms on average are seeing $.97 of every $1 of inflow go out the door, many asset managers focus their sales teams primarily on the acquisition of new advisors and developing business with existing clients.  Four important reasons to focus on resources on client retention are cost, brand perception, customer insight and product management.


Cost Efficiency

It is more cost effective to cross- and up-sell to existing customers than to attract, educate and convert new ones. It is well-known that the cost of acquiring a new customer averages five times more than the cost of retaining an existing customer.  Given that many advisors are shutting their doors to new wholesalers, firms are better off increasing growth—with less cost— by retaining and developing business with existing customers rather than acquiring new ones.

Brand Enhancement

New clients don’t have a history with... [read more]

Robo-Advisors? Why Human Financial Advisors Are Here to Stay

Earlier this week, the Wall Street Journal published a couple of articles anchored in the personal finance arena. One article discussed the ways in which people incorrectly forecast which purchases will make them the most happy. The other article presented compelling evidence that younger people today are saving less than their counterparts in years past. Intentionally or not, both of these articles contain interrelated messages essential to the personal finance and asset management industries. Indeed, if we aren’t saving money now, chances are we won’t have the privilege of spending it in the future.

Research from a variety of disciplines has consistently shown that left to their own devices, people exercise notoriously bad judgment[1]. Influenced by emotion and cognitive heuristics alike, we often make poor decisions when it comes to our money. I argue that these biases will sustain the survival of the human financial advice and planning industry.

The... [read more]

Boost Your RIA Business Through Sub-Clustering

kasina’s recent National Accounts Roundtable, brought up an interesting question and discussion: what is the average number of firms with which advisors do business?

kasina’s Advisor Insights data indicates that, on average, advisors do business with 7.1 firms while RIAs do business with only 5.2.

With the average RIA team AUM increasing 12% in 2014, asset managers are seeking to reach out and expand business with financial advisors in the RIA channel. The majority of firms have expanded their RIA sales force and have tried to find new ways to attract RIA business, but only a few have been successful. In order for a firm to be successful in attracting RIAs they need to segment and target them with a clear message based on preferences and asset allocation plans. But before any RIA clustering takes place, marketing teams need to know how their brand is perceived and capitalize based on asset allocation, strategies and communication preferences.

Beginning to... [read more]

Our Take on the Eaton Vance ETMF Approval: Part 2

With SEC approval of the Eaton Vance Exchange Traded Managed Fund (ETMF), the asset management industry now has an ETF structure that offers some limits on holdings transparency to the investment public. However, the Eaton Vance filing is an exchange traded product that is quite different from other non-transparent ETF structures, since it’s actually a modification of both a mutual fund and a traditional ETP.  For those reasons, we believe there are some considerations in the wake of the SEC approval.

Demonstrating Proof of Concept

We expect two developments over the next several quarters related to this approval. First, we clearly expect Eaton Vance to file and launch investment strategies under their ETMF structure to not only to take advantage of their filing approval, but also to demonstrate lower costs and other benefits theoretically available through an ETMF structure (versus a mutual fund). Additionally, Eaton Vance will need to demonstrate advisor... [read more]


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