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Best Blogs of the Week (SPECIAL – BREXIT II)

Posted by Anu Heda on Jun 27, 2016, in Best Blogs of the Week , tagged with American Century, BlackRock, Franklin Templeton, Invesco, MandG, MFS, Natixis, PIMCO, TIAA, Wells Fargo, William Blair, WisdomTree

Shocking the capital markets globally, the referendum to leave the EU passed. BREXIT. Asset managers were ready with comment. The proceeding table aggregates industry blog posts on Friday (only). This is an impressive volume (e-mail me if you’re seeking a perspective on quality) though as you see very little thought went to titling these posts. Of the titles below, BlackRock and WisdomTree clearly put thought into their respective titles.

Asset Manager	Blog Post
American Century	Our Views on the Brexit Vote
BlackRock	What data can tell us about the Brexit vote 5 key takeaways from the Brexit vote
Fenimore	Brexit & The value of patience
Franklin Templeton	In The Know: The UK Votes to Leave the EU Brexit: How Quickly May the Surprise Wear Off? A Global Macro View of Brexit Implications
Invesco	UK votes for ‘Brexit’ Beyond Brexit: What happens next?
M & G	Bond market reaction to UK “Leave” vote
MFS	Brexit Rattles the Market
Natixis	Brexit Interviews: Implications of the vote Brexit Vote: The New Unknowns
PIMCO	Brexit: Initial Impact and the Road Ahead Brexit’s Impact on the Eurozone
TIAA	Response to Brexit requires long-term perspective – UPDATED
Wells Fargo	Brexit: Buy the dip, or wait? Brexit vote sends shock waves through markets
William Blair	Brexit Update: Our Base Case Scenario
WisdomTree	Sterling’s Structural vs. Euro’s Political Weakness: “Brexit” Opens Opportunities

Best Blogs of the Week #234

Posted by Anu Heda on Jun 27, 2016, in Best Blogs of the Week , tagged with Russell

With so much focus (rightfully so) on BREXIT, we’ll highlight a single best blog post unrelated to this massive global topic. The post is from Russell Investments, titled “You cannot work out what’s next for China by extrapolation.”

Marketing Tax Loss Harvesting (Robo-Advisors)

Posted by Anu Heda on Jun 20, 2016, in Thoughts

Robo-advisors have been on my mind as we’ve been asked to help a few firms adjust (potentially) strategic marketing plans to consider their impact on asset management. One interesting marketing component is “tax loss harvesting” championed by Betterment and Wealthfront. Is this is an important concept, though?

On the one hand, what would typical Americans think? Well 50% of Americans believe their taxes are too high. So anything that could harvest (by definition “to win, achieve a gain”) taxes would be viewed positively viewed by that half (and probably most others) of America.

On the other, the potential benefit simply isn’t very large. According to a 2014 Betterment ADV, the 2014 average Betterment account size is nearly $15,000. Coupled with the stated benefit by 0.77% yearly, the average account holder harvests $115 yearly. Over 30 years, that could become nearly $7,000 and Betterment keenly shows you this long-term impact through videos and calculators. $115 annually for a person originating an account isn’t anything to mock. Yet, that same person probably fares better by replacing 10% of latte consumption with homebrewed coffee.

So then is tax loss harvesting a worthy tenet?

Again, on the one hand, I would say no unless you’re a ultra high-net worthy investor, tax loss harvesting isn’t meaningful enough to conceptually engage on (see image below). Yet on the other hand, because the term evokes such a compelling image, I believe it’s a quality brand message and one without much ownership.

Robo-Advisors: Betterment

Best Blogs of the Week (SPECIAL – BREXIT)

Posted by Anu Heda on Jun 20, 2016, in Best Blogs of the Week

There are just too many BREXIT posts to include them into the normal stream of content. So here’s a special: all the posts related to Brexit I found. Clearly, asset managers think this topic requires significant consideration by clients and investors.

Asset Manager	Special Edition: Brexit Blog Posts
American Funds	European Union Faces Crucial Test in Brexit Referendum
BlackRock	The investing implications of British-Stay or Brexit
Cambridge	Brexit = Uncertainty
Franklin Templeton	Brexit: All Eyes on the Politicians
Invesco	UK voters to decide
M & G	What I am doing to protect against Brexit… or Bremain.
MFS	This Week in Review: Brexit Jitters Intensify as Vote Approaches
PIMCO	How UK Corporate Bonds Price Brexit Fears
Principal	Last Exit to Brexit
Putnam	Why Brexit would spell trouble for the United Kingdom
TIAA	Brexit: suddenly, a real possibility
Wells Fargo	Growing possibility of Brexit rattles markets

BREXIT via Putnam

This is the end of your special report. We return to regularly scheduled blog posts. Please stop using the great song Should I Stay or Should I Go? Great song and an even better band (The Clash).

The Robots are Definitely Coming, But Slowly

Posted by Mike McLaughlin on Jun 06, 2016, in Thoughts , tagged with automation, Narrative Science

A few months back a friend of mine sent me a link to The Robots are Coming for Wall Street, which focuses on how automation is taking over more and more tasks once handled by humans in the financial services industry. The story’s lead anecdote relays how software from Kensho is able to digest, analyze, and publish a report on the latest US employment report within minutes. Amazing.

Of course most everyone agrees on the trend and opportunity of automation. But in discussions with my friend it became clear that the two of us have different views on the pace of change. While he sees an aggressive dismantling of how many things are done today, I believe the landscape will shift more slowly, especially through the lens of the asset management industry.

As an example, in two recent client conversations the natural language software from Narrative Science has come up. One firm just deployed their software to write first drafts of investment commentary; another came close but postponed implementation.

But what’s been more interesting to me is the frequency with which industry marketers have never heard of the company. Though the company has been written up in the Wall Street Journal and Investment News as far back as 2013, there is seemingly no widespread buzz about them specifically or these types of capabilities in general. To illustrate, Ignites has mentioned Narrative Science just a single time in a January 2015 story (subscription).

Granted I am putting this through an anecdotal lens. Even so, I think more frequently than not transformational change takes a long time. Whether the topic is Big Data, sales comp, or automation, it will be years before the word “potential” is scrubbed from the conversation.

[ image credit: Sean Davis ]