Blog

Best Blogs of the Week

Posted by Anu Heda on Apr 24, 2011, in Best Blogs of the Week , tagged with , , , ,

Each Monday, we’ll share the last week’s three best industry blogs. Hopefully, it’s something interesting to read as you get back into the flow.

  1. Russell on tax implications for investors – great use of charts and history to make the topic interesting and educational
  2. BlackRock on the construction of its silver ETF – now I know. I did wonder this and knew I could read SEC documentation about it.  But reading that documentation never sounds appealing.
  3. Franklin Templeton’s Mark Mobius on Africa’s potential – he has one theory and then just 2-3 specific reasons to consider that theory.

Did you read anything within the industry as interesting? Let us know via e-mail.

Is Anything Absolute?

Posted by Anu Heda on Apr 22, 2011, in Thoughts , tagged with , ,

This question occurs as we develop a marketing and sales approach to investment vehicles labeled “to seek absolute returns of …”  There’s a desire for investment providers to sell absolute returns, but I don’t know if there’s an interest in thinking in absolute terms.  Putnam has a set of videos that describe the absolute return mechanics.  They even produce an engaging blog dedicated to absolute return as well.  Does any of this content (or other) convince you to use absolute return investment products?

Humor me and imagine two scenarios –

Scenario 1  – FundCo’s Absolute Return had a 2% return in ’08.

Scenario 2 – OtherCo’s Absolute Return did 20% last year (’10)

In casual conversation among non-professional investors, mismatching years like this is pretty common.  If someone told you about both scenarios, where would be the first place you would go to compare these past results? If you’re like me, you may use Google finance to understand that FundCo was 39 percentage points better than the S&P in ’08, while OtherCo was about 10 better than the S&P in ’10.

My thinking is relative, not absolute.  I understand that these manufacturers are striving to produce a return regardless the direction of financial markets.  That’s a difficult frame of reference to set with prospective investors.  Professional investors provided with different funds’ returns for the same year typically look at each fund relative a relevant benchmark.

So while I haven’t seen anything compelling yet, I realize we’re still in the first act for absolute return products.  There’s a long way before the show is over.  Yet thus far, it’s not been very convincing.

How Do You Want Advisors to Follow-Up?

Posted by Mike McLaughlin on Apr 06, 2011, in Thoughts , tagged with , , , ,

I spent an hour last week monitoring an asset manager’s quarterly conference call with advisors. As the call wrapped, the executive moderating the call invited advisors to follow up via the firm’s:

  • Web site
  • Twitter feed
  • Sales team

What was interesting to me is that is the exact order in which these outlets were introduced. Web, then Twitter, and finally the wholesalers. Besides the order, the voiceover did even more to reinforce the primacy of the Web and Twitter relative to the sales team.

Obviously this a minor, tactical part of the call. But I’m intrigued by the order. I would not claim that online outlets provide more effective follow-up than a wholesaler in this case. And the call did not have enough advisors to raise concerns about an overwhelming volume of inbound calls/e-mails.

So was this a conscious decision? Is there a reason why the Web and Twitter were prioritized? I can think of a few good explanations, and will follow up here when I get a concrete answer.

If You Want the Meeting, YOU Set the Meeting

Posted by Mike McLaughlin on Mar 28, 2011, in Thoughts , tagged with , ,

A recent Your Q&A on Ignites (subscription) focuses on ensuring accountability within a sales team, in part by having clear role expectations. As an illustration, the piece says, “For example, some teams require the internal wholesaler to call the advisor in advance of a meeting with the field wholesaler.”

The example leapt off the page for me. Why? Because I believe the external wholesaler should always be the point-person when it comes to initiating, confirming, and communicating an agenda for his/her own appointments.

The reason is perception. By having an internal wholesaler handle these tasks, the importance of the client is undermined. A signal is sent that the external’s time is too valuable to be successfully setting the table for an important prospect/client conversation.

Recently I was in an advisor’s office when a hot-selling fund family came up in conversation. The advisor said he’d never met with the wholesaler from the firm:

He’s always having his assistant call and try to schedule time with me. I don’t work that way. I want to deal direct.

The advisor felt slighted by the lack of genuine interest shown by the wholesaler. He views the wholesaler’s approach as saying “my time is more important than yours.” A harsh interpretation? Sure. An uncommon one? I don’t think so.

Salespeople, of course, want to send the exact opposite message. It’s the nature of being a product/service provider.  The wholesaler who wants the meeting (and the client), should make sure his commitment is clear to the client. Direct communication is a simple and important way to do that.