Due in large part to a growing demand for advisory services driven by the proliferation of sophisticated financial products, the U.S. wealth management industry is experiencing a period of strength and stability. However, threats are on the horizon: the sector could face a shortage of approximately 100,000 advisors by 2034, according to a report by McKinsey & Co.
In its report, the strategic consulting firm suggested that it is necessary to “change the operational model of advisors to increase productivity (through lead generation, teamwork, and an AI- and technology-enabled shift toward value-added activities) and attract new talent to the industry much faster than before.”
The study also warned that, in the long term, hiring veteran advisors is not a solution: there will be around 110,000 advisor retirements, leading to a decline in the total number of advisors by about 0.2% annually over the next decade.
This shortage is approximately—according to the global consulting firm—30% of the 370,000 advisors estimated to be needed in 2034 to meet the growing demand for wealth management in the United States.
Additionally, about 27,000 advisors switch firms or go independent each year, according to the study. The decline in supply and the emergence of private equity investments in advisory firms have already driven up hiring costs, the report added. The study was authored by Jill Zucker, Jimmy Zhao, John Euart, Jonathan Godsall, and Vlad Golyk, representing the views of McKinsey’s Financial Services Practice.
The report breaks down and analyzes the increasing demand for advisory services, driven by the rise in U.S. household wealth and the growing demand and willingness to pay for human advice. It also compares this with the decline in the number of advisors.
“The advisor workforce has grown by only 0.3% annually over the past ten years (…) The number of advisors is expected to decline by around 0.2% annually. Retirements outpace hiring, as advisors are, on average, ten years older than members of similar professions. An estimated 110,000 advisors (38% of the current total), who represent 42% of the industry’s total assets, will retire in the next decade,” the report noted.
The report’s authors believe that if this fundamental supply bottleneck is not resolved, the industry will continue to face a zero-sum competition for advisor talent. “While hiring experienced advisors is crucial to the success of many firms, the industry should also adopt a long-term perspective and develop sustainable strategies to attract more advisors to the sector, help them grow faster, and enable established advisors to be more productive,” they stated.
Catastrophe bonds, whose returns have consistently outperformed high-yield debt markets in recent years, are about to become accessible to a broader segment of investors.
Next month, the Brookmont Catastrophic Bond ETF, based on a portfolio of up to 75 of the 250 so-called “catastrophe bonds” in circulation, could begin trading on the New York Stock Exchange (NYSE)—a global first.
“It’s an asset with a lot of nuances, and our goal is to demystify it,” said Rick Pagnani, co-founder and CEO of King Ridge Capital Advisors Inc, which will manage the ETF, in an interview cited by Bloomberg. The fund will be overseen by Brookmont Capital Management LLC, based in Texas.
Pagnani, who until last year led Pimco’s insurance-linked securities division, stated that “it is difficult to create a diversified catastrophe bond portfolio for a typical individual investor.” By packaging catastrophe bonds into an ETF, “we aim to lower some of the barriers to entry,” he said.
The market, dominated by U.S. issuances, is currently valued at approximately $50 billion, according to Bloomberg.
According to Pagnani, the pipeline of projects remains “strong and growing,” which could help push the market to $80 billion by the end of the decade.
Brookmont and King Ridge are still finalizing the lineup of partners involved in launching the ETF. They aim to raise between $10 million and $25 million in initial capital. The ETF is registered with the SEC.
The fund will cover risks ranging from Florida hurricanes and California earthquakes to Japanese typhoons and European storms, according to the prospectus filed with the U.S. market regulator.
As outlined in the prospectus, it is an actively managed ETF that, under normal circumstances, will invest at least 80% of its net assets in catastrophe bonds. It will not have restrictions on specific issuances, risks, or geographic exposure. However, the document notes that at times, the fund may have a relatively higher exposure to U.S.-related risks.
Additionally, it may occasionally have a greater concentration in Florida hurricane-related catastrophe bonds than in other regions or risks due to the higher availability of such investments relative to the global market.
Vanguard became the world’s largest ETF at the start of this week, marking a milestone in an industry valued at $11 trillion, according to a statement from the firm.
According to figures from the asset manager, financial agencies, and the market, Vanguard’s S&P 500 ETF (NASDAQ: VOO) now manages nearly $632 billion in assets, after recording approximately $23 billion in inflows so far this year.
The increase in inflows pushed VOO above the SPDR S&P 500 ETF Trust—commonly known in the market as SPY—which lost its title as the world’s largest ETF, now managing around $630 billion in assets.
Nonetheless, the competition between the two funds remains very close. While SPY is no longer the largest ETF in terms of assets, it remains highly valued by asset management professionals for its ease of trading and low costs, features that allow fund managers to enter and exit the market quickly.
SPY was launched in 1993 by the U.S. stock exchange and State Street Global Advisors, making it one of the longest-running ETFs still in operation today. This fund has long benefited from a significant first-mover advantage in terms of size and trading volume. Now, with its rapid growth, Vanguard has surpassed SPY, marking a new chapter in the global ETF industry.
The scale of operations in both funds is enormous, although SPY continues to set the standard in this segment. According to Bloomberg data, over the past twelve months, SPY has averaged daily trading volumes of $29 billion—the highest for any ETF. In contrast, Vanguard’s VOO averaged $2.8 billion in daily trades.
Vanguard’s alternative emerged in 2010 and immediately experienced rapid growth, thanks to the firm’s reputation and loyal following among investors. This includes financial advisors looking to boost their commissions. Over the past twelve months, VOO has attracted more than $116 billion, setting a record for annual inflows.
The appeal of the index-based fund highlights the profile of Vanguard’s core clients, such as cost-conscious financial advisors and retail investors with a long-term investment focus.
The “buy-and-hold” strategy has been a key differentiator between the two ETF giants. While VOO investors favor this approach, SPY is valued by professional traders for its high liquidity and narrow spreads. However, its higher trading volume often results in significant flows in both directions (inflows and outflows).
Analysts highlight a key fact: VOO has never experienced an annual net outflow since its launch in 2010, whereas SPY has recorded net withdrawals in five years over the same period.
Last year, Mexico received another record amount of remittances from its workers abroad, primarily in the United States. Official figures indicate that remittance income totaled an unprecedented $64.75 billion. However, due to changes in U.S. immigration policy, the outlook could shift.
As an indication of the importance of remittances for Mexico and its top recipient states, the Latin American country solidified its position in 2024 as the world’s second-largest recipient of remittances, surpassing China (which received $48 billion). Only India ranked higher, reporting inflows of $129 billion.
The significance of remittances in Mexico is already reflected in key indicators. For example, their share of GDP increased from 2.0% to 3.6%. Additionally, they now account for 5.2% of private consumption, compared to 2.8% in 2010.
“Without a doubt, remittances serve as an important supplement to household income. When compared to total wages (as estimated by the National Occupation and Employment Survey, ENOE), the proportion stands at 16% (2023),” noted the Banamex research team.
Seven States at Risk
Although all states in Mexico receive remittances, seven states are particularly dependent on these flows. In some cases, remittances have become essential to state economies, with entire communities relying almost entirely on them.
In 2024, seven states accounted for more than half of the total remittance inflows. Michoacán, Guanajuato, and Jalisco each received around $5.5 billion, representing 8.7% of the national total for the first two states and 8.5% for the third. Combined, these three states accounted for 25.9% of the country’s total remittances.
These states, which have historically seen high levels of migration, have consistently led in remittance inflows since data collection by state began in 2003. Mexico City, the State of Mexico, Chiapas, and Oaxaca complete the list of the seven states that received over half of the country’s remittances, with 7.2%, 7.1%, 6.4%, and 5.3%, respectively, for a total share of 52%.
Over the past decade, Mexico City and Chiapas have significantly increased their share, rising from 5.4% and 2.9% in 2003, respectively. Meanwhile, Michoacán has seen a decline in its share, dropping from 12.4% in 2004.
According to Banamex, in some states, remittances account for more than 10% of GDP. The inflow of these funds has reached levels similar to those of Central American countries that are highly dependent on remittances.
For instance, in 2023, remittances to Mexico represented more than 20% of GDP in Guatemala, El Salvador, Honduras, and Nicaragua. Meanwhile, in Chiapas, the share reached 16%. In three other states—Guerrero, Michoacán, and Zacatecas—remittances accounted for 13.8%, 10.9%, and 10.6%, respectively.
Moreover, in some Mexican states, remittances play an even more crucial role due to socioeconomic conditions. In Chiapas, Guerrero, and Zacatecas, remittances represent 52.7%, 50.8%, and 47.7% of total payroll income, respectively.
As a result, the income generated abroad by workers from these states or with ties to them is equivalent to half of what the entire employed population produces in those regions. When combining salaries with remittance income, one in every three pesos in household income in these states originates from abroad. These states are among the most economically disadvantaged in Mexico, with high levels of informal employment (74.6%, 78.3%, and 60.6% of the Economically Active Population).
The Trump Factor
The return of Donald Trump to the U.S. presidency and his policies against foreign workers, particularly undocumented immigrants, could alter the conditions and flow of remittances to Mexican states that rely on them.
Banamex warns: “Trump’s return to the White House and the immigration policies implemented in the early days of his administration, along with a projected weakening of the U.S. labor market—including for workers of Mexican origin and Mexican-born individuals—suggest a potential decline in remittance flows. This could limit migration and further discourage the hiring of undocumented workers.”
“In addition, we anticipate increased volatility in these flows over the coming months, partly due to growing fears of deportation among migrants, which could reduce work hours and encourage temporary savings for survival. For 2025, we estimate a 2% increase in nominal U.S. dollars, reaching $66 billion, though risks remain tilted to the downside,” stated the Mexican bank.
One potential mitigating factor for those dependent on remittances in Mexico is a possible currency depreciation. However, nothing is certain, and remittance flows remain another likely casualty of Trump’s return to the White House
Despite Donald Trump’s return to the White House and the rise of right-wing parties in Europe, asset managers remain optimistic about the outlook for sustainable investment this year. So far, sustainable investment funds have shown significant growth in recent years. According to 2023 data, these funds reached approximately €500 billion in assets under management, with Europe accounting for 84% of this total—around €420 billion.
How Do Investment Firms View 2025?
According to Pascal Dudle, Head of Thematic and Impact Investing at Vontobel, sustainability will remain important despite challenges posed by recent political shifts. It will be driven by companies maintaining their commitment for reasons ranging from economic opportunities to risk management.
“A key example of this was the unexpected yet encouraging support from ExxonMobil’s CEO during COP29 in November, urging incoming President Trump not to exit the Paris Agreement and to keep the U.S. Inflation Reduction Act (IRA) intact. 2025 will also see continued investor scrutiny of the myriad ESG approaches being offered, with stricter strategies, such as impact investing, likely among the winners,” says Dudle.
He also believes that energy transition is here to stay, as clean technologies are now economically viable, scalable, and come with limited technological risk. “The need for reliability and resilience should, in particular, drive investments in infrastructure, such as increasing investment in power grids to ensure their reinforcement and modernization,” he adds.
Trump’s Challenge to Sustainable Investment
While investors—and Europe—continue their shift towards sustainability, the Trump administration has taken a different path. His first term was marked by rollbacks in environmental protections, the U.S. withdrawal from the Paris Agreement, and skepticism toward climate science. These policies affected the global sustainable finance ecosystem, meaning his return could once again test the resilience of ESG investment.
In his second term, Trump has declared a “national energy emergency,” in line with his campaign promises. According to experts at Allianz Global Investors, the measure aims to strengthen the U.S. fossil fuel sector, the world’s largest oil producer, and cut energy prices by 50%.
“His actions will complicate the fight against climate change. Additionally, skepticism surrounds Trump’s ability to halve energy prices as he claims. During the 2020 pandemic, even when oil prices turned negative, U.S. energy costs only dropped by 19%. Other factors, such as his order to replenish the Strategic Petroleum Reserve, could even push prices up in the short term,” state Greg Meier, Senior Economist at Allianz Global Investors, and David Lee, U.S. Energy Sector Specialist at Allianz GI.
Their conclusion is clear: “While Trump’s actions reinforce his commitment to fossil fuels, their actual impact on lowering energy costs will likely be limited and far from his stated expectations.”
Key Takeaways for Investors
In this context, Sophie Chardon, Head of Sustainable Investment at Lombard Odier Private Bank, believes investors should focus on sectors less exposed to political shifts, such as infrastructure, digitalization, energy efficiency in buildings, water management, and precision agriculture.
“From an investment perspective, Trump’s second administration could increase sectoral and regional divergence as the U.S. loses momentum in sustainable investments. After the sharp declines in sustainable investment valuations in late 2024, earnings dynamics are now in control, making stock selection crucial,” Chardon explains.
She also highlights that while the U.S. may slow its climate efforts under Trump, global momentum—especially from China and the EU—should keep the transition to green energy moving forward.
“Investors will need to focus on sectors that are less exposed to policy risks and on those aligned with long-term demand for clean technologies, infrastructure, and climate resilience,” she insists.
Europe’s Advantage in ESG Investment
According to Deepshikha Singh, Head of Stewardship at Crédit Mutuel Asset Management, investment prospects remain uneven.
“Investors may witness significant rollbacks in federal climate action and reporting standards. Trump’s pick to lead the SEC, Paul Atkins, has been openly opposed to the SEC’s climate disclosure rules. However, states like California and New York will likely continue setting ambitious climate goals,” Singh states.
Despite this, Singh sees Europe maintaining its leadership in sustainable investment, which could be a key advantage for investors.
“European companies that align with strict ESG regulations could attract more capital, while U.S. companies struggling to meet international standards could face higher costs and reduced access to foreign markets. The alignment of the European financial sector with the Paris Agreement and COP29 goals presents opportunities for those prioritizing green investments.
Additionally, Europe may seek to influence global financial markets by expanding ESG disclosure requirements for internationally operating companies, which could impact U.S.-based multinationals and other global corporations,” Singh explains.
The Future of ESG Investment Amid Political Cycles
For Singh, sustainable investment’s resilience lies in its ability to adapt to political cycles. While she acknowledges that Trump’s policies may pose challenges for some aspects of ESG investing, she sees it as unlikely that the overwhelming global shift toward sustainability will be reversed.
“Investors, driven by both risk management and opportunities, will continue to integrate ESG factors into their portfolios, even in the face of opposition. The demand for transparent and responsible investments will persist, regardless of who is in the White House.
In fact, Trump’s second term could even emphasize the urgency of private-sector leadership in driving the sustainable investment movement in the U.S. and beyond,” Singh concludes.
Jupiter Asset Management has announced the launch of the Jupiter Global Government Bond Active UCITS ETF, the Group’s first exchange-traded fund (ETF), in collaboration with HANetf, a specialist in white-label ETFs.
Jupiter has been exploring new ways to distribute its products and expand access for more clients to its extensive investment expertise. With greater execution flexibility, a high degree of transparency, and competitive pricing, active ETFs offer clients an alternative and democratized entry point. In line with Jupiter’s truly active high-conviction investment management approach, active ETFs also provide investors with the potential for higher returns than traditional passive products.
The Jupiter Global Government Bond Active UCITS ETF, or GOVE, aims to outperform traditional sovereign bond investments by offering a diversified portfolio of developed and emerging market government debt, with low correlation to equities and other risk assets. Due to their complexity, potential for market inefficiencies, and sensitivity to macroeconomic factors, global sovereign bonds represent an ideal asset class for an active ETF.
The fund is managed by Vikram Aggarwal, a sovereign debt investment manager who has been with Jupiter since 2013. The fund’s investment strategy focuses on identifying inefficiencies in sovereign bond market valuations by comparing Jupiter’s perception of the current economic regime with market expectations. This contrarian approach seeks to capitalize on opportunities when there is a significant divergence between perceived and actual economic conditions.
“We are pleased to partner with HANetf for the launch of our first active ETF. We have been exploring new ways to provide clients with access to Jupiter’s extensive investment expertise, and today’s launch is part of that strategy. We know that greater transparency, faster execution, and competitive pricing are driving clients to increase their exposure to active ETFs. We believe Jupiter’s truly active investment approach and differentiated product offering position us very well to grow assets in this exciting new space,” said Matthew Beesley, CEO of Jupiter.
Hector McNeil, Co-Founder and Co-CEO of HANetf, stated: “We are delighted to work with Jupiter on its first active ETF at this pivotal moment for the market. Net inflows into active ETFs from European clients increased by more than 50% between Q1 and Q2 of 2024. Total assets under management in Europe now exceed $41 billion, and as clients increase their allocations, we are seeing very strong growth momentum.”
Vector Global WMG has added Alberto Valdés to its international business in Houston, according to information available on BrokerCheck.
With 15 years of experience in the Texas business, according to Finra records, he joins the new firm to provide brokerage and advisory services to clients in Mexico.
The financial advisor, who comes from Alterna Securities, where he joined in 2021, worked for 12 years at BBVA in Houston, serving clients from Mexico between 2008 and 2020, according to his BrokerCheck profile.
According to industry sources, at Vector Global, he will focus on providing broker/dealer services and advisory services to clients in Mexico.
Valdés holds an MBA from the Instituto Tecnológico Autónomo de México and a Certificate in International Trade, Finance, Business, and Management from the UCLA Anderson School of Management.
The ETF industry continues to grow, and financial advisors need specialized training on the subject. In this context, BlackRock, in partnership with the Kaplan Financial Planning School, has launched a portfolio construction and ETF certification program for financial advisors.
The new program is designed to equip advisors with comprehensive resources and tools to have more informed conversations about the opportunities ETFs could bring to their clients’ portfolios, the School—founded in 1972—announced in a statement.
Among other topics, the course covers an understanding of ETF fundamentals, highlights global trends transforming the industry, and explores how ETFs can be used to build a wide range of diversified investment portfolios. The program is available through the university’s state-of-the-art learning platform, and students have up to 120 days to complete it.
“ETFs have revolutionized the way investors build portfolios and have increasingly become the preferred vehicle for many,” said Daniel Prince, Head of iShares Product Consulting at BlackRock in the U.S.
“Product innovation and investor education are the foundation of how we empower investors with choices and easy access to help them achieve financial well-being. We are excited to partner with Kaplan to help financial advisors deepen their knowledge of different investment strategies and how they can be implemented in portfolios,” he added.
In 2024, the U.S. ETF industry experienced unprecedented growth, with more than 650 new ETFs launched by December 2024, surpassing the previous year’s record by over 150. Additionally, in 2024, net inflows reached approximately $1.1 trillion, exceeding the previous record of $901 billion set in 2021.
JP Morgan Private Bank continues to expand its team in Miami with the hiring of Nando Costa.
The banker, with nearly 20 years of experience, coordinates a team of specialists to design strategies for investments, lending, trust and estate planning, philanthropy, among other tasks described in his LinkedIn profile.
Costa, originally from Brazil, began his career at Morgan Stanley in 2006 before moving to JP Morgan Private Bank, where he worked from 2010 to 2018.
“We are pleased to welcome Nando Costa as executive director and banker at J.P. Morgan Private Bank in our Miami office. Throughout his career, Nando has built long-term relationships with centers of influence and enjoys connecting clients with like-minded individuals to explore synergies,” Garza posted.
Costa works closely with business owners, executives, entrepreneurs, and U.S.-based families with international ties who seek the sophisticated capabilities of an industry leader, according to his profile description.
The risks to the U.S. economy and inflation following Donald Trump‘s return to the White House dominated much of the discussion at the annual dinner where CFA Society Miami shares its economic outlook.
This time, the featured speakers were Eugenio Alemán, Chief Economist at Raymond James, and Jim Bianco, President of Bianco Research. The discussion was once again moderated by Jeremy Schwartz, Global CIO at WisdomTree, who proudly wore a Philadelphia Eagles jersey, celebrating the team from his hometown, the latest Super Bowl champions.
Guillermo Rodríguez González-Valadez, President and Director of CFA Society Miami, opened the event by emphasizing the organization’s important role as a hub for networking and exchanging ideas among its members.
He also highlighted CFA Society’s educational work with local universities such as Miami University, FIU, and UF, noting that students interested in finance can now start their CFA Charterholder certification as early as their junior year of college.
But before the dinner, Funds Society spoke with the two speakers and the moderator.
The Effects of Trump
Eugenio Alemán explained that after growing 2.8-2.9% in 2024, the U.S. economy is expected to grow 2.4% this year, driven by fiscal expansions inherited from the Biden administration. However, he warned that potential tariffs announced by Trump could reduce growth to 1.8-1.9% and also impact inflation.
“The January inflation report was bad: it rose 0.5% instead of the expected 0.3%, with housing costs decreasing but other factors rising. Trump‘s administration’s tax cuts, especially in federal spending, could negatively impact the economy, affecting consumer and business confidence,” he stated.
“The Fed has not yet reached its 2% target, and the imposition of tariffs could make inflation control more difficult,” Alemán added.
In his view, the biggest risk is the shift in consumer and business confidence, which could lead to an economic slowdown. “Federal government workers and multiplier effects could be severely affected, leading to broader economic issues,” he predicted.
Investment Strategies
The one-on-one discussion between Jim Bianco and Funds Society focused on market expectations and investment strategies in this uncertain environment. The expert introduced the concept of the “4-5-6 market” and forecasted returns of 4% for cash, 5% for bonds, and 6-7% for stocks in the coming years, highlighting inflation’s impact on interest rates.
Bianco explained that inflation has pushed the Fed‘s next rate cut back to September. “The bond market has suffered significant losses due to rising rates from near-zero levels, but that phase is now behind us, with an average bond market coupon of 5%,” he pointed out.
He revisited the concept of TINA (“There Is No Alternative”), arguing that cash and bonds now provide viable alternatives to stocks. According to him, the traditional 60/40 portfolio is evolving, with bonds potentially offering returns similar to stocks but with lower volatility.
Finally, in his interview with Funds Society, Jeremy Schwartz predicted that the 10-year Treasury yield could rise to 5.5% due to a potential Fed pause and historical interest rate trends. This, in his view, could pressure stock valuations.
“Earnings estimates for the year are high: between 16-17%, a significant increase from the previous 8-9%,” he said. His short-term outlook is cautious, but he expects 6-7% long-term returns, based on earnings yields and inflation. He also warned of the risk of a market correction due to high earnings expectations.
The panel also discussed the role of passive investing in equities and fixed income, with Bianco suggesting that there could be a shift toward active management in equities in a slower-growth market. Other key topics included long-term productivity trends and the impact of AI on the U.S. economy.
