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The INsiderblog

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

Sep 30, 2016

Attrition fears play into broker-dealers' hesitation to detail new commission schedules under DOL fiduciary rule

By Greg Iacurci

One main theme emerged amid discussion about the Labor Department's fiduciary rule at the Insured Retirement Institute's annual conference this week: Broker-dealers are either still determining the annuity commissions that would likely satisfy the rule's “reasonable compensation” requirements, or they've made that determination but have taken a vow of silence.While it's likely not broker-dealers' primary motivation for keeping mum, fear of adviser attrition plays into their strategy, insurance and brokerage executives said. Let's take a step back for a second to set the stage. The Department of Labor's regulation, released in April, makes a fiduciary of anyone receiving compensation for providing investment advice in retirement accounts such as IRAs and 401(k)s.The rule, which aims to eliminate conflicts of interest, says advisers and financial institutions must only receive reasonable compensation for the recommendation of ... Read full post

Nov 20, 2015

Is Fidelity's plan to ditch relationship with Betterment and build its own robo too little, too late?

By Alessandra Malito

Fidelity Investments' plan to sever its relationship with robo-adviser Betterment Institutional in favor of building an automated investment platform on its own has some observers wondering if the mutual fund giant's strategy is too little, too late.The pair's "strategic alliance" contract will end in December after only a year, as first reported by RIA Biz. Fidelity will continue to work with advisers who choose to use Betterment, and it also will work with other third-party robo vendors, Fidelity spokeswoman Erica Birke said in an email. At the same time, Fidelity will use its resources to create its own digital advice platform. "[M]any of our clients are still looking to learn more about digital advice," Ms. Birke said. "We have been and will continue to deliver the solutions, thought leadership and insights our clients need to feel informed and capitalize on this important trend."DETAILS IN 2016The company will announce more... Read full post

Jun 9, 2015

TD Ameritrade Institutional: Elite LINC 2015: Advisers must brace for volatility

By Frederick P. Gabriel Jr.

It's nice to be one of TD Ameritrade Institutional's "elite" financial advisers.I know because I am hanging out with 168 of them at TDAI's Elite Adviser Summit at the uber swank Grand Del Mar Resort in San Diego, Calif. Not only are they getting treated like adviser royalty, but they get to mix and mingle with one another and TDAI's top brass, including president Tom Nally, and TD Ameritrade chief executive Fred Tomczyk.The three-day gathering brings together financial advisers from 150 firms representing $170 billion in assets under management. My back-of-the-napkin calculations puts that at about $1.13 billion per firm . . . hence the word "elite" in the name of the meeting.Among the firms represented are Beacon Pointe Wealth Advisors, Savant Capital, Abacus Wealth Partners, The Colony Group, Regent Atlantic Capital, Modera Wealth Management and Brookstone Capital Management.... Read full post

May 29, 2015

Advisers: Quit talking to and about each other on social media

By Alessandra Malito

As more advisers flock to Twitter, Facebook and LinkedIn, it's time for them take a closer look at their posts — and focus on whether they're providing what clients and, more importantly, potential clients, really want. Sometimes it seems as though the financial services side of the Twitter universe is filled with technical jargon and comments about what is happening in the industry. But investors are turning to Twitter and other social media sites to find advisers with whom they can discuss important financial decisions. Investors' hunger for these sorts of resources was illustrated in a survey from Brunswick Group, a communications firm, which found 70% of investors believe the digital media will play a role in future investment decisions. So it comes down to the conversation, which is all about sparking relationships. Of the estimated 228,000 advisers who actively use social media, 74% use LinkedIn, 75% use YouTube, 65% use... Read full post

May 15, 2015

Question for advisers: Why did Verizon buy dial-up dinosaur AOL?

By Alessandra Malito

Advisers can learn a thing or two from Verizon Inc., which last week said it would spend $4.4 billion to acquire AOL. It seems strange, given that AOL is known for its archaic dial-up system and the scratchy tone that comes with it, but Verizon saw value in the company. Why? Because its sights are set on mobile. Maybe this story might sound familiar to financial advisers, given that they have heard time and time again about the inevitability of a mobile-centric mentality. But the Verizon-AOL deal is yet another confirmation that any antiquated system is going to have to get a mobile makeover or it won't survive. “It does make a great example for financial advisers,” said Walter Lis, a digital marketing strategist who works with financial advisers, referring to the big deal. “The percentage of mobile traffic is increasing exponentially every month.” It's true. In a memo from AOL chairman and chief executive Tim... Read full post

May 7, 2015

Time may have come to eliminate sales incentives in the annuities business

By Darla Mercado

Even as fiduciary duty becomes a common phrase in the parlance of financial advisers, insurance agents are still offered gold watches and other incentives for annuity sales. Sen. Elizabeth Warren, D-Mass., brought the issue of incentives in exchange for annuity sales to the fore in late April, when she sent letters to senior executives at the largest sellers of fixed, indexed and variable annuities. In those letters, she pointed out the industry's use of incentives to reward agents for selling annuities. For the most part, it's the field marketing organization (annuity distributors that work with independent agents) that are offering cruises, gold watches, and iPads. Though Ms. Warren's findings were enough to make headlines at major media outlets, it's hardly news to those of us who've been covering the industry for years. I myself have been on the insurance beat for close to nine years, since I was fresh out of graduate school.The... Read full post