June 21, 2016Should you block your clients from buying 'bad' products?
Fidelity is making its brokers bar clients from buying unsuitable products, such as certain exchange-traded notes it deems bad choices. Suitability standards and fiduciary responsibilities are one thing, but if a client has their heart set on a specific investment, should you block them outright?
Of course! It's our job to make sure our clients are investing wisely.32% You can't. I'll advise my client it's a bad move, but if I blocked them they'd just go somewhere else.
June 14, 2016What're the Chances a Lawsuit Can Stop the Fiduciary Rule?
Earlier this month Sifma and a consortium of plaintiffs brought suit in federal court to block the Department of Labor's new fiduciary rule. The suit claims the DOL has no right to regulate the space. Now more suits, one led by the National Association for Fixed Annuities and another by the American Council of Life Insurers, have also been filed. But what are the chances any of these suits will be successful?
A good chance: At least one of the suits has sound arguments that are likely to stop the DOL in its tracks.42% It's 50/50 that one of these lawsuits can win.39% No chance: The suits have no merits. They're just posturing.
June 7, 2016What Will You Need to Compete in 10 Years?
Financial technology is altering the industry. The question is whether it’s simply an enabler or a complete game-changer. In a decade what’ll it take to compete as a financial advisor?
Just myself and some technology to keep track of clients. Any client a robo could steal isn’t worth keeping.90% As investments — and advice — becomes commoditized by easy-to-access technology, I'll need to advise clients on all aspects of their financial lives, from budgeting to risk management in the broadest sense.
May 31, 2016How Important is Your Cultural Background?
Research from Spectrem Group asserts that one-fifth of investors want an advisor who shares their cultural background – such as race, religion or sex. How important have you found shared cultural background in your own practice?
Extrememly important33% Very important18% Moderately important22% Slightly important14% Not at all important
May 24, 2016Are Beneficial Ownership AML Rules an Implementation Nightmare?
Last week the Treasury Department's Financial Crimes Enforcement Network (FinCEN) released new rules which mean advisors need to identify not only their clients for anti-money laundering purposes, but also anyone who is a "beneficial owner" or influencer of any legal entity represented – like trusts or private companies. The rule applies to new accounts and the implementation period starts in July, ending in May 2018. But how easy will this new AML function be to perform?
Easy. It's the sort of info you'd collect anyway. And if you don't, you should.38% Hard. This will mean extra probing, discomfort and paperwork. The client mightn't even have this info.
May 17, 2016What's the Deal with Charles Schwab's Franchise?
Charles Schwab's ambitious indie franchising initiative is approaching its fifth anniversary. Do you think:
It's an innovative solution that is bound to catch fire in coming years.48% The strategy puts too much risk in the hands of indie owners and won't take off.33% It fits into Schwab's long-term plan to expand its brand, if given enough time.
May 10, 2016Are Prepackaged Model Portfolios Better Than Customized Allocations?
New Cerulli research argues that home office prepackaged model portfolios have been more popular with investors over a five-year period than customized advisor portfolios. Cerulli says prepackaged products are less tactical but have a stronger emphasis on risk-adjusted returns and consistent styles of investing. Cerulli also believes advisors are sometimes over-influenced by their clients. Are prepackaged products better than the allocations advisors come up with themselves?
No. Pre-packaged products don't account for the individual's circumstances.51% Yes. The client's better served if you find the right pre-made portfolio, rather than trying to build it yourself.
May 3, 2016Does Selling Loans Help or Hinder Your Overall Proposition?
Goldman Sachs is encouraging third-party advisors to sell its loans. Do these sorts of extra product offerings help you to serve your clients better?
Yes. I find that the more financial service options I have for my clients the better.42% No. These types of offerings create conflicts.
April 26, 2016Are Sole Practitioners Fading into the Sunset?
Research firm Cerulli Associates says solo FAs are getting thinner on the ground. Do you see this trend continuing?
Yes. Though there will always be mavericks, scaling up has become vital to survival due to rising costs.53% No. Automation and outsourcing empower those who still want to work alone.
April 19, 2016Do Your Clients Understand What a Fiduciary Is?
With all the publicity surrounding the release of the Department of Labor's new fiduciary rule, how much does the public really understand about the concept of a fiduciary?
Yes – My clients have always understood the term because I explained it to them4% Yes – They haven't missed the media explosion over the new DOL rule80% No – They still don't really grasp the idea