ETFs

A look at the numbers shows that exchange traded funds are starting to move in lockstep with RIAs and vice-versa. RIAs invested $496 billion in ETFs in the 12-month period ended June 30, 2015 – that’s a $78 billion increase compared to the same period the year before. By comparison, the wirehouse channel added 20% fewer ETF assets, or $397 billion in the last year; granted, an amount that was $70 billion greater than its aggregate investment during the same 12-month period the year before, according to Broadridge Financial Solutions. RIAs that manage portfolios and make discretionary investment choices for their clients value ETFs because they provide advisors with easy access to market segments at a cheap price – an especially important factor for RIAs who are compensated on an asset-fee basis. Fee-based advisors appreciate ETFs’ tax efficiency, liquidity and broad exposure at low cost. Conversely, RIAs are a prized channel for ETF-makers like State Street, Invesco, PowerShares, Vanguard Group and BlackRock. ETFs are also a major ingredient in portfolios devised by robo-advisors -- essentially automated RIAs -- for the mass affluent who invest more than 90% of their assets using ETFs.

Louis Navellier: All Navellier and sub-advised portfolios have GIPS-complaint fact sheets and we have been GIPS-compliant for 20-plus years.

Louis Navellier ready to present 'extremely strong defense' to daunting SEC fraud charges

The Florida-based mutual fund owner says he advertised using GIPS-compliant material such that: 'I didn't sell this at all'

September 19, 2017 — 12:19 AM UTC by James Picerno

Brooke's Note: Louis Navellier is unbowed in the face of withering charges of fraud from the SEC. See: Navellier is latest to catch F-Squared affliction as SEC broadens parameters of wrongdoing. The case may boil down to whether or not a jury buys his ...

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Richard Powers: If [new products] don’t differentiate in product design or exposures, some form of traditional active is how many firms look at ETF’s as 'my only shot.'

Morningstar renders ETF verdict by discontinuing ETF-only conferences after category becomes the Vanguard-BlackRock show

Smaller, newer ETF players are forced to pursue micro-niches and active management -- only to encounter the big players lurking there, too

September 13, 2017 — 5:26 PM UTC by Graham Thomas

Brooke's Note: ETFs have a bright future. Morningstar has a bright future. Neither seems remotely replaceable. But human characters as diverse in nature as Chip Roame, David Booth and Jack Bogle have long cautioned that nobody should count mutual funds out. That Morningstar is now ...

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Alex Bryan: Schwab is on the cusp of making that bridge to the top space in ETFs

Charles Schwab & Co.'s vertical play to monopolize ETF market -- to be its low-cost maker, distributor and manager -- diesels ahead as ETF OneSource grows again

San Francisco giant executes macro strategy to underprice Vanguard, get paid big bucks to sell third-party funds for free, sell ETF portfolios gratis in its industry-leading robo-advisor and keep custody of $1.4T of RIA assets fast-converting to ETFs

July 14, 2017 — 8:51 PM UTC by By Lisa Shidler

Brooke's Note: In an earlier phase of my life I partnered with a friend to start a brew pub and ran into an interesting problem. It turns out it is illegal to be both a big maker of beer and an owner of a ...

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Lukas Smart brought DFA fervor to a surprisingly self-critical smart beta conference.

The smart beta ETF industry gets blasted at swank Manhattan summit by an unlikely group of critics

The active-but-passive category soared from $200 billion to $620 billion in the past four years, but Rob Arnott and other big smart-beta names at Convene were not in a gloating mood

June 15, 2017 — 2:44 AM UTC by Janice Kirkel

Brooke's Note: Whoever the genius was who coined the term "smart beta" was smart, like a politician. In a sense, the whole category starts with the promise that you can get something for nothing. But smart beta ETFs have few critics, perhaps because the ...

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Martin Small: Clients are voting with their feet. Our year-to-date market share is 45% in net new flows.

How BlackRock stopped Vanguard from devouring ETF market share by pleasing RIAs -- but how that strategy could endanger iShare profit margins in the long run

The $5 trillion iShares-maker scores with low, low-priced 'non-Core' ETFs that don't cannibalize high-margin Core iShare products but the liquidity of the cheapo funds could be a problem

May 8, 2017 — 7:50 PM UTC by Janice Kirkel

Brooke's Note: Had BlackRock CEO Larry Fink asked for my opinion about whether he could turn around the aircraft carrier advance of Vanguard ETFs in terms of market share by simply creating a handful of ETFs that compete with Vanguard on price, I'd ...

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Andy Rachleff (as quoted in the NY Post): If you don’t read the disclosure, you don’t get confused about it.

Andy Rachleff makes waves with NY Post quote: Don't get 'hung up' on our lose-more-funds-than-you-deposit disclosure

Fresh off blasting BlackRock, the feisty Wealthfront CEO claims he was 'misrepresented' as the robo offers ready credit lines for those with $100K-plus in taxable accounts

April 25, 2017 — 9:06 PM UTC by Janice Kirkel

Brooke's Note: Much about the business of automating financial advice remains in flux, but one thing is certain: only the fiercest competitors need apply. The robo version of Survivor plays out as top Wall Street firms, the nation's largest banks and the most ambitious Silicon ...

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Scott Smith: Sophisticated investors will realize that saving $5 against 40 or 50 basis points for the total expenses for the year isn't a savings.

Why ProShares yanked ETFs from Schwab's no-commission OneSource ETF exchange

The fund firm puts faith in the drawing power of its own brand -- and saves more than $2 million

April 3, 2017 — 7:04 PM UTC by By Lisa Shidler

Brooke's Note: The negotiation goes four ways with RIA: custodian, fund provider and investor when it comes the no-transaction-fee platforms. Guess who generally loses out in this Rubik's Cube scenario historically? In this case, ProShares decided to be a pioneer in 2014 with five funds on ...

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Peter Mallouk owns a $21-billion RIA already growing with organic ferocity. Then Tony Robbins shows up and whoosh.

The 10 RIABiz stories advisors connected with most deeply in 2016 and how hubris and humility ran amok in this didn't-see-it-coming year

How did Aequitas swamp CONCERT? Power outages at LPL, Cetera and Wealthfront? Adolescent robo problems? And was that Tony Robbins hawking his money book ... again?

December 28, 2016 — 5:54 PM UTC by Dina Hampton

Brooke's Note: Choosing which articles were of greatest interest to RIABiz readers in 2016 was easy because a Google robot  measures the final results of your reading output.  We then refresh your human memory about why the story was so irrestistible at the time. Big ...

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Bill McNabb explained himself after Vanguard announced some hyper-competitive price cuts.

Vanguard and BlackRock slash prices at Christmastime but only Vanguard feels the need to defend its actions

The Malvern, Pa. giant is just doing what it always does, CEO Bill McNabb says, and it isn't just 'another volley fired in the fee war'

December 27, 2016 — 5:27 PM UTC by Brooke Southall

Brooke's Note:  When we talk about the lowering of RIAs fees -- or at least restructuring them so that they better reflect the value being delivered by advisors -- one thing that continues to obscure the need for reimagining fees is a compliant stock market.  See: Fidelity ...

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Michael Park: We need to ask them questions about their business challenges, their points of pain and their strategic priorities.

T. Rowe Price plucks an RIA 'pain' expert from Vanguard Group to rethink asset management delivery

With net flows flattish in Baltimore, Michael Park arrives to make sales interactions with RIAs more of a 'dialog'

December 21, 2016 — 6:09 PM UTC by Sarah O’Brien

Brooke's Note: T. Rowe Price has proven to be skeptical about chasing after trends in mutual fund sales. See: Why only 10% of elite RIAs are receptive to fund wholesalers yet depend on a handful of good ones. Its esteemed name was long synonymous with ...

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Ben Johnson, Joe Mansueto and Tom Lydon at last week's Morningstar ETF confab

Asset managers at Morningstar's ETF event, facing an in RIA-in-charge future, show mettle

The Chicago event connected traders, index providers, issuers, marketers, PR, distributors -- and a knee-capped Liz Ann Sonders -- all trying to find footing in an everything-up-for-grabs playing field

September 15, 2016 — 6:44 PM UTC by Graham Thomas

Brooke's Note: It's not easy being a traditional asset manager in a world fast turning to ETFs and particularly ETFs based mainly on indexes. It is arguably even harder to be a company like Morningstar that earns its bread by distinguishing between these fast-vanishing funds which are ...

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Ben Johnson: This latest filing is the last rabbit that you'd imagine they'd try to pull from the hat.

After Vanguard gains $550-billion ETF lead, Fidelity makes 'rabbit out of the hat' play to regain ground

But even as Boston execs attempt magic, Vanguard makes almost simultaneous ETF move that requires no lagomorphs

August 22, 2016 — 10:54 PM UTC by Lisa Shidler

Brooke’s Note: One presumes this battle for managed assets is personal for Fidelity CEO Abby Johnson. After all, she was weaned at Fidelity on the mutual fund side of the business and it’s hard to imagine that the battle with longtime rival Vanguard ...

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Sharon French: Over the course of the next decade there will be a lot of other strategies that we will develop.

Hard numbers that show the zero-sum advantages of RIAs over wirehouse brokers as told by fund flows

The hold by the Merrill Lynch and Morgan Stanley crowd over product manufacturers is fast slipping

July 28, 2016 — 9:00 PM UTC by Lisa Shidler

Brooke’s Note: Sometimes RIAs are extolled in such loose terms that the critic would be fair to question whether it’s all an urban myth. Hard numbers pointing to RIA success are indeed difficult to nail down. See: How many RIAs are there? No ...

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Bill McNabb mingled at Morningstar conference -- here stopping for a post-speech word with John Rogers, CEO of Ariel Investments

Vanguard CEO says: 'We are a technology company' and hints strongly that robo-for-RIAs may be in the offing

Bill McNabb oversees 3,000 engineers who are willing to pay for 'dry holes' in drilling for the next Shaybah Oil Field of financial advice

June 16, 2016 — 8:17 PM UTC by Graham Thomas

Brooke’s Note: Again, Graham Thomas has done great work reporting for RIABiz from an industry event though his job description does not include asking hard questions and scribbling furiously. We are well aware that he is conflicted in making this report but, at least ...

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Charles Biderman: Our shareholders have expressed disappointment that they would now be forced to accept a different investment strategy.

How Charles Biderman hopes to parlay his 'insane' firing by AdvisorShares from his five-star ETF into a win

TrimTabs' CEO is taking competitve action against the Maryland-based asset manager of $1.1 billion and seeking redemption by luring the investors he served into a startup ETF

June 13, 2016 — 9:04 PM UTC by Brooke Southall

Brooke’s Note: It seems like we need new terminology to describe this happening. A “forced breakaway”? But as the one whose hand is being forced, Charles Biderman is none too pleased with his opportunity for a new life as a manager rather than subadvisor ...

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