By most measures, 2022 won’t go down as a great 12 months for investors or for the advisers guiding their finances. While not quite an “annus horribilis” on the order of 1929 or 2008, the year was marked by soaring inflation, a sinking stock market and a bond market torpedoed by steadily rising interest rates.
In this issue, InvestmentNews journalists look at 2022 through the lens of their individual coverage areas and offer a balanced recap of the year’s events. What follows — in the spirit of the 12 days of Christmas, the eight days of Hanukkah, the seven days of Kwanzaa and the beginning of the long march to summer heralded by the winter solstice — is a much cheerier (and more irreverent) recap of a dismal year.
The years-long transition from mostly commission-based revenue to mostly fee-based revenue has done wonders for the ability of advisers and their firms to weather a storm. Instead of revenue taking a dive along with the Dow, firms didn’t have to scramble for reasons to write tickets in 2022. Fee income may have slipped due to declining asset values, but advisers and their firms were being able to take the downturn in stride. In fact, sitting tight is now not just in clients’ best long-term interests, it’s in the industry’s, too.
The bond market took a beating in 2022, and municipal bonds weren’t exempt from the drubbing. On the whole, as measured by the S&P Municipal Bond Index, munis were down 12.5% for the year through the end of October. Then the clouds broke and the index started rising. Now the yearly loss should be around 7%. Sure, less of a loss is still a loss, but for wealthier investors in high-tax states, muni bonds now offer very attractive tax-equivalent yields. And if advisers can use any capital losses in munis to offset capital gains elsewhere — maybe from the sale of real estate — so much the better. Who needs a hot stock when you’ve got boring bonds?
What if a hot sector in financial markets imploded and — not much happened? That’s the welcome news from the otherwise depressing collapse of FTX and the meltdown of the cryptocurrency market. Sure, many ordinary investors who shouldn’t have been in such a high-risk “investment” in the first place lost everything. That is a tragedy for them and their families. But even some supposedly smart money people got burned, like “Shark Tank” personality Kevin O’Leary, who at first didn’t like crypto, then liked it, and now doesn’t like it anymore. O’Leary says he “lost” $15 million of the money he was paid to be an FTX spokesman during the period he liked crypto. Too bad for Kevin. But for the financial system, the fall of FTX has been a blessed nonevent. No liquidity freezes, no cash crises, no banks being saved, no middle-of-the-night Federal Reserve meetings. Hallelujah!
The group led by a 37-year industry veteran brings $470 million in assets to the Philadelphia-based broker dealer.
The Atlanta, Georgia-based national wealth firm revealed its new PE partner as prior backers Wealth Partners Capital Group and HGGC’s Aspire Holdings exited their investments.
The latest departures in Ohio mark another setback for the hybrid RIA, which is looking to "expanding its presence across all models and segments of the wealth management industry.”
The St. Louis-based real estate investment firm gives the asset management giant a valuable access point to the roughly $1 trillion net lease market.
Eliseo Prisno, a former Merrill advisor, allegedly collected unapproved fees from Filipino clients by secretly accessing their accounts at two separate brokerages.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
