Mutual fund assets decreased slightly in January 2024, but still managed to have their best month for flows since January 2023, according to the latest issue of The Cerulli Edge—U.S. Monthly Product Trends.
Meanwhile, ETF assets reached a new all-time high, with a notable division of flows between active and passive ETFs. However, commodities and allocation ETFs had a particularly bad month, shedding 2.5% and 2.3% of assets due to flows during the month, respectively.
The uncertain economic, monetary, and political outlooks, as well as increased emphases on tax awareness and ESG considerations, are driving high-net-worth (HNW) wealth management firms to improve their strategic asset allocation services in many ways.
Integrating customization and optimization tools, such as direct indexing, into wealth managers’ standard asset allocation service offerings is increasing firms’ ability to provide their clients additional value.
Implementing more bespoke investment solutions and private market investment access to clients at scale increasingly requires intermediaries to have a robust account aggregation and performance reporting ecosystem.
The trend towards customization and private market investments is becoming increasingly important in the HNW wealth space. As clients demand more personalized and tailored investment solutions, wealth management firms must adapt and innovate to meet these needs.
By providing access to private market investments and implementing customization tools, firms can differentiate themselves from their competitors and provide added value to their clients, concludes the report.
