Author: Anu Heda

Best Blogs of the Week #259

It’s been a memorable first week into the new US administration and the industry’s bloggers kept up, to a degree. This week we highlight a clear take on the administration’s rhetoric as well as multi-factor investing (smart beta).

MainstayIs the Tide Turning on the Dollar? – In President Trump’s inaugural address, he stated that “protection will lead to great prosperity.” The U.S. dollar, subsequently, fell.

SSgA3 Charts on Recent Smart Beta Trends – We continue to believe that value stocks will be the best performing factor over the subsequent year driven by their attractive valuation relative to history.

Memorable Performance Data - 2016

 

Best Blogs of the Week #258

Last week ended with the 45th inauguration of an American President. The week was full of blog posts related to the new administration. Last week’s SSgA post kicked off the style and many other managers followed suit. Post types ranged from what to look out for to prognostications. Below are two of the higher impact posts.

AB – Trump and Asia: Now the Good News – The biggest impact in the short term is likely to be through reflation. Markets have quickly adjusted since the US election in anticipation of higher inflation, partly from Trump’s promise of fiscal measures, such as investment in infrastructure, to stimulate the domestic economy.

PutnamDoes the market rally really depend on Trump? – We see two forces at work in the rally: First, it reflects an improvement in nominal GDP since the middle of 2016, independent of the policy situation; and, second, it indicates optimism for the new Trump administration’s proposals for tax cuts, infrastructure spending, and regulatory easing.

Inauguration

Best Blogs of the Week #257

Though many blog posts this week opined on the President-Elect’s first 100 days, this post from SSgA is more original and straightforward than other firm’s posts on the topic.

SSgAThe First 100 Days: Will Trump’s Campaign Promises Translate into Policy? – Trump’s early days will allow investors to gain insight into how the Republican Party will govern and to glean details of policy platforms on which Trump campaigned but never provided specifics.

 

100

(via SSgA)

About Us: The Most Important Copy Nobody Cares About

Building on Mike’s post last month about marketing multi-asset class solutions, I reviewed asset manager’s “About Us” (or “Our Profile”, “Who We Are”, etc.) pages. Personally, I believe these pages (approaches vary from a single-page format to a 3-page section) are valuable and can impact professional buyers positively or negatively.

Anyhow, after reviewing ten firms, my immediate thought: wow, this content is dull!

Nearly all the firm’s pages follow a recipe with key ingredients of history, size/breadth, and high-level capabilities. The pages are full of vapid lines such as ‘We are among the world’s strongest financial firms’.

After my initial reaction, I started to wonder why this occurs. I think there are four reasons (not mutually exclusive).

First, there’s significant desire from many Marketing teams to shift to timeless or evergreen content versus timely, knowing the resources and effort timely content requires. I see the value in timeless content for certain topics, such as investor education. I understand and empathize with the thinking: we need to have fewer pieces to update so we can get our position on 2017 Muni Bonds out there fast. I think making the About Us absolutely evergreen leads to writing devoid of any business updates (e.g., acquisitions, new regions) and caps a firm’s ability to differentiate.

Second, everyone internally has a say on the About Us pages (just like everyone has an opinion on brand refreshes) and nobody wants to burn bridges by overly focusing on one channel or set of capabilities, leaving others to feel subjugated. But that all-children-are-equal approach is rarely true. Writing to a least offensive (internally) denominator is good office politics that leads to dull, high-level writing.

Third, writing interesting About Us pages is difficult. We’re in an industry with narrow differences between competitors and few firm story levers to pull. That combination challenges even the most earnest marketer to create something engaging. The simple issue of difficulty shouldn’t dissuade the marketer charged with creating compelling (potentially evergreen even) writing. Yet, rarely have I seen someone internally challenged and rewarded for creating high-quality About Us pages. It can be done but needs prioritization and prominence.

Fourth, site metrics will show how few page views About Us receives (relative to a high-yield bond strategy profile for sure) so why bother? I don’t think all page views are equal, however, so the raw metrics argument always sounds specious. As stated initially, About Us pages can impact prospective buyers and current clients.

Personally, I think Neuberger Berman did an effective About Us upgrade recently. Their About Us quickly lists the firm’s support points providing the user with clear copy related to each point. Additionally, the user can quickly access firm data (AUM, investment professionals, etc.) and link to other sections of the Web site.

Upgrading the About Us section dovetails nicely with overall brand design work. Next time there’s an effort related to the firm’s brand, consider devoting resources to the About Us.

Outlooks

2017 Outlooks are like Snowflakes

The industry’s blogs are currently awash in two post types: the year in review (2016) and outlooks (for 2017). I reviewed a dozen (list here; PDF) 2017 outlooks posted over the last four weeks. No two posts are alike. The lack of any standardization in tone, length, and type of prediction is informative in its own right. For a time-strapped FA, I can clearly see why he/she may gravitate to same 2 – 3 firms known from years past.

Three interesting takeaways about outlooks:

  1. There’s nearly no overlap across firms. I expected to see significant topical commonality, such as 50%+ offering an end-of-year target for the S&P 500. Not the case.
  2. Two firms use “2017 Outlook” in the post’s title and offer no predictions. I think the typical reader sees that title and expects some amount of prognostication.
  3. Many firms do not provide clear predictions and include a tremendous volume of “may see” and “could occur” woven into the text. This may be compliance related for some firms, though others (e.g., AB, BlackRock) are comfortable with their investment professionals writing predictions.

Across the 12 firms, I counted 28 predictions (my threshold: need a definitive statement or graphic related to a 2017 prediction). The BlackRock post had the most (6) and the average was 2.3 predictions/post. In case you’re curious of some differences, here are four examples how firms provide predictions.

AB – Says it with a chart. (chart too large to include)

American Century – Casts winners and losers. “And the Potential Winners Are… Regional banks with commercial loan exposure could benefit from rising inflation expectations and a steeper yield curve.”

M & G – Makes it relative to a geography or asset class. “Brazil will not be the outperformer in 2017 as existing valuations are priced for a perfect execution of policy.”

TIAA – Uses Straight-talk and blunt languge. “The rise in the U.S. dollar pauses even if rates move higher.”