An announcement this week that Fidelity is launching retail mutual funds with management expense ratios of zero basis points shows how asset managers are evolving to capture a greater share of a shrinking fee pool.
Tag: Mutual Funds
Although smart beta is still a small category with just $430 billion in AUM, or 0.5% of the global total, it has grown by 30% a year since 2012, according to Boston Consulting Group.
While not a new concept, materiality is essential to efficiently integrating ESG factors into the investment process; it all boils down to being able to determine which ESG factors are likely to be linked to stronger investment performance by identifying risks that are related to certain industries.
The expense ratios 401(k) plan participants incur for investing in mutual funds have declined substantially since 2000, Investment Company Institute data shows.
Expense ratios of target-date mutual funds averaged 0.44% in 2017; since 2008, ICI explains, the expense ratios of target-date mutual funds have fallen 34%.
PLANSPONSOR speaks with John Diehl, senior vice president of strategic markets for Hartford Funds, on the subject of equity market volatility and ways to help ease plan participant concerns amid big price swings.
Morningstar estimates that investors saved more than $4 billion in fund fees in 2017 by continuing to gravitate toward lower-cost funds.
Their No. 1 objective for client portfolios is downside risk protection
Morningstar Grows Fund Ratings System with Quantitative Rating; First Trust Merges Two Funds; and Vanguard Changes Benchmarks for Funds.
However, the deadlines for creating a liquidity risk management program and to limit illiquid investments to 15% of a fund’s portfolio remain unchanged: December 1, 2018, for larger fund groups and June 1, 2019, for smaller fund groups.
ERISA requires plan sponsors to regularly monitor investment lineups to ensure they remain prudent—a task made more complicated by the multi-layered construction of target-date funds; a new paper points to the best practices of defined benefit plans for some guidance.
Invesco launches Peak Retirement Target-Date Fund Series, and Efficient Advisors launches mutual fund partnership with Dimensional.
“Saving more is the most obvious and effective way to improve retirement outcomes," J.P. Morgan experts say.
Brokers serving retirement plans and other institutional investors were accused of routing orders for equities to an offshore affiliate in Bermuda that “executed them on a riskless basis and opportunistically boosted profits by adding a mark-up or mark-down on the price of a security.”
“A bad day in 2017 was a flat day,” says Bob Doll, chief equity strategist at Nuveen Asset Management. “Turning to 2018 we can be quite optimistic once again, but even so, we have to keep in mind that 2016 and 2017 were not normal.”
“Investors could benefit enormously from a compact and timely disclosure document that they actually look at and understand,” said SEC Commissioner Kara Stein.
Along with non-monetary relief, Allianz will pay $12 million into a common fund for the benefit of class members, to be allocated pro rata among the members in proportion to their account balances in the plan during the relevant period.
BNY Mellon releases fund focused on income generation, and AI Insight announces new liquid alternative research.