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InvestmentNews reporters offer their take on intriguing or controversial articles from around the web.

Aug 15, 2018

'Billions' star Maggie Siff touts Betterment in new ad campaign

By Ryan W. Neal

Betterment has a new advertising campaign that employes the talents of actress Maggie Siff, who currently plays psychiatrist Wendy Rhoades on the Showtime series "Billions." In the 30-second TV spots, Ms. Rhoades tells investors, "Don't settle for average investing. Demand Better." Using Betterment's digital, automated investing service, investors can "outsmart average." "The law of averages promises everything evens out in the end. That's not true, and that's not you," Ms. Rhoades says in one of the ads. "Betterment is designed to break the law of averages with tax efficient technology and personalized advice." You see what Betterment is going for here. No one wants to be average, especially when it comes to investment returns. It's a sleek ad with a compelling message, featuring a star from a popular show about successful investors. The music is pretty dope, too. But it's interesting to see Betterment put a negative spin on the word... Read full post

Aug 7, 2018

Enough with the surveys saying millennials need to save more for retirement

By Ryan W. Neal

A new survey finds many millennials are spending more each month on restaurants, clothes and coffee than they are saving for retirement. It must be a Tuesday. If you haven't heard, my generation loves coffee, avocado toast and killing beloved American industries all while refusing to move out of our parents' house.​ The latest data, a LendEDU poll of 1,000 Americans age 22 to 37, finds that nearly half of millennials are spending more money on restaurants and dining out than they are putting into retirement accounts. Thirty-two percent spend more on clothes than they save, and more than a quarter reported spending more on coffee, alcohol and online streaming services. Thirty-seven percent aren't saving for retirement at all. Before the older generations' bellyaching gets too loud, keep in mind that 22 to 37 is a huge age range, and factors like employment and income level factor heavily. A 22-year-old could still be in school ... Read full post

Aug 2, 2018

Fidelity's zero-cost funds raise issues for 401(k) advisers

By Greg Iacurci

Fidelity Investments is making 401(k) advisers' lives a little more complicated. The Boston-based behemoth dropped some eye-popping news Wednesday: as of Friday, it will begin offering two index mutual funds with a price tag of 0.00%. Yes, funds free of cost to investors — the industry's first. The funds, in the total-market and international equity categories, will be available to retail investors. They won't be offered to participants in defined-contribution plans, at least initially. But let's not kid ourselves — it's only a matter of time before Fidelity or another index-fund giant, perhaps BlackRock Inc. or Vanguard Group, brings a no-cost fund to 401(k) investors."It could be a fire-starter," said Philip Chao, principal and chief investment officer at Chao & Co. It wouldn't be a surprise. No-cost funds represent the extreme of a trend that's been playing out for years in retirement plans. The average asset-weighted... Read full post

Jul 27, 2018

Is it better to meet with clients in person or online?

By Ryan W. Neal

Is it better to meet with a client in person, or virtually? It depends on who you ask. According to research from FactSet, a data analytics provider, high-net-worth individuals now conduct 44% of their interactions with an adviser online. The number is lower among sub-$1 million investors, but jumps up to 48% for investors with wealth exceeding $20 million. A separate study from Hartford Funds found the frequency of client interactions is skyrocketing. Two-thirds of the advisers surveyed already interact with their clients on at least a weekly basis, either to discuss investment strategy or simply touch-base. A third of advisers expect interactions to increase by 50% in the next five to 10 years, a rate that surely couldn't be sustained by in-person meetings."As advisers thread the needle and both communicate more frequently and meet in person, it's essential that they embrace firm-approved digital alternatives (like video chat) that... Read full post

Jul 16, 2018

Writing on the wall for direct-to-consumer robo startups

By Ryan W. Neal

The consolidation of direct-to-consumer robo-advisers is in full swing. Hedgeable, an early digital adviser that stood out for targeting wealthier clients with active management, hedging strategies and access to alternative investments like venture capital funds and cryptocurrency, announced last week that it will discontinue its investment management service on Aug. 9. The news comes just two months after Northwestern Mutual's decision to shut down LearnVest.​ In December, Amanda Steinberg closed WorthFM, a female-focused robo-adviser launched in 2015. The WorthFM website, which now directs users to Sallie Krawcheck's Ellevest, cites "industry shifts and our own business" as reasons it can no longer offer investment advice. The announcement from Hedgeable was surprising, but not entirely unexpected. Industry observers have long forecast doom for the direct-to-consumer startups not named Betterment and Wealthfront as banks,... Read full post

1:21 pm EST

Celebrated investor Jim Rogers launches ETF

By John Waggoner

Celebrated investor Jim Rogers has launched an exchange-funded fund. The most intriguing question about this news: Will the perennially bearish Mr. Rogers be able to stay invested?The Rogers AI Global Macro ETF (BIKR), which launched Thursday, is a global ETF that invests primarily in single-country ETFs. It will use artificial intelligence to evaluate periods of volatility, which, in turn, will help it find indications of shifts in market direction. Aiding the AI will be Mr. Rogers, who co-founded the Quantum Fund, one of the first international hedge funds, with George Soros in 1973. The fund clobbered the Standard & Poor's 500 during his tenure.Mr. Rogers left Quantum in 1980 to travel around the world on a motorcycle, teach and invest. His 1994 book, "Investment Biker," tells of his global travels, as does its 2003 successor, "Adventure Capitalist." While Mr. Rogers has been optimistic about Asian economies and commodities, he's... Read full post

5:51 pm EST

Tech firms still want to dethrone the financial sector

By Ryan W. Neal

Wall Street embraces technology these days, but Silicon Valley still thinks it can take over the financial industry. If there was one theme that stood out at the CB Insights Future of Fintech conference in New York City this week, it's that financial technology startups still believe they can "disrupt" traditional financial services firms and improve everything from banking and credit to financial advice. "A real fintech company hasn't come to the fore yet," said Max Levchin, a co-founder of PayPal who is now CEO of Affirm, a lending fintech. While the industry has made significant strides towards digital adoption, Mr. Levchin thinks the big questions — like how do people get access to credit? What do bank accounts look like? — are more or less the same today as they were 50 years ago. "In the U.S., things that have always been this way are still being this way, and that's where the opportunities really are," Mr. Levchin... Read full post

Jun 5, 2018

Women to Watch: Help us find the next generation of female leaders

By Suzanne Siracuse

What a year for women's empowerment!Over the last nine months, obstacles that women face personally and professionally have been making front-page headlines and sparking powerful movements such as #Metoo and Time's Up. These efforts are bringing much-needed attention to these critical issues.Sadly, these are not new issues, and they are not limited to Hollywood and celebrities. These issues have been prevalent in the financial services industry, as well. But the positive news out of it all is that more firms are understanding certain behaviors and policies cannot and will not be tolerated. And change is on the horizon. By bringing attention to important issues and topics, we all have the ability to change the way women are treated and valued now and in the future. So how does InvestmentNews' Women to Watch initiative fit into all this?InvestmentNews is proud to have launched our Women to Watch initiative in 2015 with the mission of... Read full post

Jun 1, 2018

Hedge fund scam artist targets the middle class

By Bruce Kelly

Investment scams that hit working people or the middle class typically are pretty prosaic. They include church scams, such as a pastor cloaking his phony investment pitch in holy talk, or what are known as affinity frauds, in which the person committing the fraud belongs to and identifies with the same ethnic or religious group he preys upon. Regular people with small amounts of money are simply not of interest to a criminal with a sophisticated sounding investment pitch who's looking to make a big score. Con artists who target the wealthy or upper middle class — think of Bernie Madoff — often talk about sophisticated investment strategies, rather than Jesus, to con their victims. The more complex the strategy, the more impressed the rich mark. Mr. Madoff played this game brilliantly, claiming he bought blue chip stocks and took options contracts on them, using something known as a "split-strike" strategy to earn his... Read full post

2:13 pm EST

Envestnet Yodlee raises the bar with AI-powered apps

By Ryan W. Neal

Any doubts as to who is leading the way on adviser technology should be put to rest after last week's Envestnet Advisor Summit. In addition to announcing updates to Tamarac and a plan to launch an annuities marketplace, Envestnet gave a first look at the new artificial intelligence tools it's building with Yodlee's data and technology.They are miles ahead of anything else on the market. (More: Envestnet is the industry's 800-pound tech gorilla)Envestnet Yodlee Chief Executive Anil Arora demonstrated three applications during his keynote. The first, Envision IQ, plugs into a firm's data and provides an easy-to-use interface to which advisers can pose any questions they may have about their business or their clients. Using either a desktop or mobile device, advisers can key in queries like "Who are my top clients?" or "What are my new money flows?" or "Did any clients add cash last week?" and receive an answer within seconds. If advisers ... Read full post

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