Franklin Templeton

Best Blogs of the Week #262

Posted by Anu Heda on Feb 27, 2017, in Best Blogs of the Week , tagged with ,

Only two posts this week (focused on inflation) and one question.

Franklin Templeton – K2 Advisors : Why We Like Activist Hedge Strategies – It could be said that activist managers in some ways represent the only strategy that generates alpha to some degree. While not always successful, activist funds seek to unlock “hidden” value in the companies they invest in.

William Blair – The Impact of Inflation – In other words, bonds were behaving more like equities. Now that inflation is becoming more apparent, I believe that repricing in the bond market has only just begun.

inflation

 

Question – do you think this chart proves that ETFs do not cause volatility? It seems to mash two things: ETFs are popular and volatility is low to make a point about causes of volatility. What do you think?

Best Blogs of the Week #260

Posted by Anu Heda on Feb 06, 2017, in Best Blogs of the Week , tagged with , ,

Quality posts this week, led by a captivating post comparing this administration to the start of Reagan’s.

Franklin Templeton – The Sectors Most Likely to Cheer US Tax Reform – It’s always tough to gauge the impact of policy shifts in isolation. However, we think broad tax reform combined with other fiscal stimulus measures, such as infrastructure spending and repatriation of foreign profits, could be very effective (at least in the short term) in providing a boost or acceleration in gross domestic product (GDP) growth over the next several years.

Mainstay – Reagan vs Trump: Parallels, Implications, and Results – In 1981, U.S. inflation was just starting to decline from peak levels near 15%, as the Fed lifted rates above 20% to choke off inflation. An elevated unemployment rate in 1981, at 7.8%, with baby boomers still entering the workforce, meant there was considerable scope for workers to return to or enter the job market, once inflation was arrested and broader economic conditions improved. It also meant there was pent-up demand for credit. By contrast, inflation is now inching up from below 2%

Principal – Questions around financial regulation changes – For all of the fighting around Dodd-Frank, it’s one of the primary reasons the U.S. banking sector was able to right itself so quickly after the 2008 financial crisis.

Reagan: Is it morning again?

via Mainstay

 

Reflation

Best Blogs of the Week #251

Posted by Anu Heda on Nov 21, 2016, in Best Blogs of the Week , tagged with , ,

Favorite post of the week covers reflation (Act of stimulating the economy by increasing the money supply or by reducing taxes, seeking to bring the economy back up to the long-term trend, following a dip in the business cycle. It is the opposite of disinflation, which seeks to return the economy back down to the long-term trend.) . Less than two weeks since the election and most industry blog posts continue to describe potential changes and situations across regions and asset classes. I tend to like posts with a clear viewpoint on 1 – 2 issues.

BlackRock – Welcome to the new world of reflation – Besides the impact of aggressive fiscal stimulus that President-elect Trump has proposed, inflation expectations are rising on the back of fundamental developments that preceded the election.

BlackRock – What a Trump presidency could mean for bond markets long term – We see a potential headwind for municipal bonds.

Franklin Templeton – A Fresh Look at DOL and Retirement Issues Under Trump – Trump has a very limited, if any, agenda on retirement issues that we can determine. His advisors have been quoted as calling for the repeal of the DOL fiduciary rule, but his populist rhetoric has been largely adversarial toward Wall Street.

Wells Fargo – The investment landscape after the election – After a brief hiccup, I think the market has it right: Trump will be pro-growth. This should be good for stocks and not good for high-quality bonds.

 

Examining Industry Web Site Log-In and Registration

Posted by Anu Heda on Sep 12, 2016, in Thoughts , tagged with , , , , ,

We’re frequently asked for an opinion on financial advisor site authentication. In turn, we often ask if any content absolutely requires a log-in. FAs do not like to register and maintain an additional ID/Password, so securing as little content as possible is a sound initial mindset.

Yet, we understand that broker-dealer only materials require authentication. So what are today’s industry log-in and registration options? I examined how 19 firms enable advisors access to secure content and found two interesting conclusions.

Log-In / Authentication

Of the 19 firms, 8 firms try to authenticate the FA through an e-mail match against the firm’s CRM. Eaton Vance showcases that approach; when the FA tries to access secure content, eatonvance.com asks only for an e-mail address (see below). So an advisor with an e-mail already captured in the CRM does not need to register. That means 12 of the remaining firms make log-in harder than necessary for known FAs to access the content they want.

Eaton Vance Registration

Matching first against CRM will become status quo and firms without that capability are digital laggards.

FA Registration

Firms present registration in one of two forms:

  • 6 of 19 firms require a clear affiliation with a broker-dealer, either through a CRD number, dealer number (via Franklin Templeton), or valid broker-dealer e-mail address (via Legg Mason). This is typically a short form registration requiring only 4 or 5 data fields.
  • The 13 remaining firms present a single or multi-step process (via TIAA) that requests typical online registration information with 10 or more data fields, but without a CRD or Dealer number.

In parallel to these two registration approaches, 4 of the 19 firms also allow FAs to bypass on-site registration via social sign up. All four authenticate via LinkedIn and two also allow authentication via Facebook and Google. Royce (example) uses the LinkedIn approach with an “authorize” window popping up for user acknowledgement.

An abbreviated registration form with a required CRD or Dealer number is more straightforward than long-format registration.

Best Blogs of the Week #242

Posted by Anu Heda on Aug 07, 2016, in Best Blogs of the Week , tagged with , , ,

Four interesting posts this week highlighted by a game theory discussion via William Blair.

Franklin Templeton – Spotlight on Brazil– Once political stability is restored, tackling much needed structural reforms should be a priority, in our view.

Van Eck – Quality Can Be Rewarding in Emerging Markets Bonds – Overall, investors who maintained exposure to investment grade emerging markets sovereign bonds, with an allocation to BB-rated bonds or 20%, would have earned 7.55% over the past ten years versus 7.83% on the broader emerging markets sovereign index, with lower volatility and higher risk-adjusted returns as measured by the Sharpe ratio.

Vanguard – Do ETFs make the value of the underlying securities more expensive?–  … strong or weak flows into certain ETFs or categories do not inflate or deflate prices any more than mutual fund flows or the collective purchases of individual investors into stocks like Apple or Facebook. Rather, ETFs reflect the valuation of the underlying securities they are composed of, which is driven by the collective wisdom of all market participants.

William Blair – Dimensions of Influence Drive Game Theory Analysis – What does this have to do with investing? Game theory provides a way for us to better organize and process the vast amount of information that affects global economies and markets.

the 5-factor spider graph; a Mike McLaughlin favorite