93% of the assets in the Broker/Dealers (B/D) channel are controlled by the 25 largest firms by assets under management (AUM) concentration, and the top 10 firms have increased their share of advisors to 62%, according to the latest U.S. Broker/Dealer Marketplace 2024 report by Cerulli.
As these companies aim to consolidate and expand their market position, advisory technology will become a strategic imperative and a key differentiator.
Over the past decade, the largest firms have taken advantage of their size, attracting more advisors to their platforms through technological enhancements and aggressive recruitment packages.
The quality of a B/D firm’s technology has proven to be a critical factor for both retaining advisors and attracting experienced advisors from other firms, the consulting firm’s report states.
Cerulli’s study concludes that advisors who switched firms in the past three years most frequently identified the quality of the firm’s technology (55%) as a key factor influencing their decision to join, followed closely by the quality of back-office support (53%) and compensation (49%).
“Investments in technology and administrative support can significantly enhance a firm’s appeal, making it a more conducive environment for advisors to thrive,” says Michael Rose, director.
Rose added that as the appeal of independent channels, which tend to offer greater autonomy and flexibility, looms as a competitive threat, a technology experience that empowers advisors to provide high-quality services and client experiences, while also enabling them to efficiently manage their business, is a powerful defensive and offensive strategy for B/Ds.
Overall, more robust technological infrastructure, better home-office support, and stronger resources for teams working in a collaborative structure are all factors that can enable scale. This allows advisors to work more efficiently, improve the range and quality of services offered to clients, and retain assets, summarizes Cerulli.
“However, scale alone does not guarantee enhanced platform capabilities,” Rose states, concluding that “broker/dealers will need to invest in the right technology to drive advisor growth and ensure a sustained advantage.”
The Securities and Exchange Commission’s Division of Examinations publishes its annual examination priorities to inform investors and registrants of potential risks in the U.S. capital markets and to highlight the examination topics it plans to focus on in the new fiscal year.
This year’s examinations will prioritize both perennial and emerging risk areas, such as fiduciary duty, conduct standards, cybersecurity, and artificial intelligence.
“The 2025 examination priorities of the Division of Examinations enhance confidence in our constantly evolving markets,” stated SEC Chair Gary Gensler.
The Division reviews compliance with federal securities laws by investment advisers, investment companies, broker-dealers, clearing agencies, and self-regulatory organizations, among other SEC-registered entities.
It also prioritizes examinations of practices, products, and services that, based on a risk assessment, pose higher risks to investors or the integrity of the U.S. capital markets.
The annual publication of examination priorities promotes the SEC’s mission and aligns with the Division’s four pillars: promoting and enhancing compliance, preventing fraud, monitoring risk, and informing policy, the Commission’s statement added.
For fiscal year 2025, in addition to conducting examinations in core areas such as disclosure practices and governance standards, the Division will also assess compliance with new regulations, the use of emerging technologies, and the robustness of controls aimed at protecting investor information, records, and assets.
The 2025 examination priorities cover a wide range of potential risks for investors that companies should consider when reviewing and strengthening their compliance programs.
However, this list is not exhaustive regarding all the areas the Division will focus on next year. The scope of any examination may include analysis of other risk factors, such as an entity’s history, operations, and products and services.
“Our 2025 examination priorities identify key areas of potentially higher risks and related harms to investors. We expect registrants to assess their compliance programs in the areas we’ve identified and make necessary changes to protect investors and maintain fair and orderly capital markets,” said Keith Cassidy, Acting Director of the Division of Examinations.
The 2024 U.S. presidential elections have been shaken by a series of political events in recent weeks. Here is a brief overview of how either government would address these challenges and the possible repercussions for geopolitical stability, U.S. national security policy, and the markets. Vice President Kamala Harris has assumed a significant role in the Biden administration’s foreign policy. In almost every area, the vice president’s stance on foreign policy closely aligns with President Biden’s. Therefore, regarding a possible Harris administration’s foreign policy, we should expect “more of the same” with continuity in both approach and personnel.
This means continuing to focus on protecting and promoting strategic sectors in industries critical to great power competition with China, such as artificial intelligence, quantum computing, biotechnology, and others (Harris, in particular, has supported U.S. export controls and restrictions on foreign investment in advanced semiconductors). It also means continuing to deepen relationships with U.S. allies in both economic and national security domains, including ongoing U.S. support for Ukraine and Taiwan, and increasing reliance on NATO and other multilateral organizations or initiatives. Her choice of Tim Walz as her running mate could be a differentiating factor in relations with China, as Walz – though highly critical of the Chinese Communist Party – has a strong personal relationship with the country and its culture.
Trump: His policy would likely reflect a similar approach to his first administration.
In summary, we would expect a more transactional U.S. foreign policy, similar to what we saw during President Donald Trump’s first administration, particularly regarding Ukraine and Russia, and including Taiwan.
Trade would also likely shape U.S. foreign policy in a second Trump administration. The former president’s promise to impose significant trade tariffs on China – as well as on some U.S. allies in Europe and the Indo-Pacific – would likely be a key feature of Trump 2.0’s approach to the world, almost certainly adding new tensions to U.S.-China relations, as well as new frictions with traditional U.S. allies.
Investment Implications: More winners and losers in the “new era” regardless of policy.
Regardless of the outcome in November and the differing policy priorities of Vice President Harris and former President Trump, the global geopolitical environment will remain challenging, likely for the next several years. In such an uncertain national security environment, U.S. leaders and other policymakers around the world will continue to emphasize national security, often at the expense of economic efficiency.
Therefore, investors should prepare for a very different context than in previous periods, including selective protectionism as the new normal, an increasing likelihood of inflation and structurally higher interest rates, more differentiated macroeconomic cycles, and lower global growth than what was seen during the “Goldilocks” period of globalization.
Allfunds has announced the appointment of Patrick Mattar as the new Global Head of Exchange-Traded Products (ETPs) Distribution. This announcement aligns with their intention to launch an ETP platform in 2025, an expansion that will complement their offerings of traditional and alternative funds, establishing a comprehensive three-pillar platform with a full spectrum of exchange-traded products under an integrated solution.
According to the company, in his new role, Patrick will be responsible for leading the development and launch of the ETP platform, guiding the strategy for this segment, and ensuring smooth integration with Allfunds’ existing suite of services. His focus will be on driving innovation, enhancing customer experience, and ensuring the platform’s long-term success in an evolving financial landscape.
“I am excited to join Allfunds and lead this exciting project. The opportunity to develop a comprehensive ETP platform is incredibly stimulating, and I look forward to working with the talented Allfunds team to deliver innovative solutions that meet the evolving needs of our clients,” said Patrick Mattar, Global Head of ETP Distribution.
Allfunds highlights that Patrick brings extensive experience to the role, having held leadership positions in leading financial services organizations. Before joining Allfunds, he was Global Head of ETFs at Aberdeen Standard Investments (now abrdn), and previously served as Managing Director at iShares, BlackRock, where he spent nearly a decade helping to drive the growth of ETFs through new products and uses by investors.
Patrick holds a Master’s degree in Economics from the University of St Andrews and was a fellow at the University of Pennsylvania. He also earned a Master’s in Science from the University of Stirling and attended Trinity College Dublin.
Following this announcement, Juan de Palacios, Head of Strategy and Product at Allfunds, commented: “We are delighted to welcome Patrick to Allfunds. His experience and leadership in the ETP and ETF sectors will be crucial in the next phase of our growth, and we are confident that under his direction, our new platform will deliver significant value to both the ETP ecosystem and our clients.”
The global fintech platform iCapital has announced that it has surpassed 200 billion dollars in alternative investment assets.
“Increased demand for high-quality private market funds from global clients has led to this milestone and accelerated the growth of client assets on the iCapital platform,” the firm announced in a statement.
According to iCapital, the financial professionals and asset managers using its platform doubled the amount of assets from 100 billion dollars in December 2021 to more than 200 billion dollars in September 2024.
Additionally, more than 104,000 financial professionals have conducted transactions on the iCapital platform over the past 12 months, with an average of four visits per month, the statement noted.
Currently, the platform provides access to more than 1,630 funds from over 600 asset managers, marking a more than 77% increase in the number of funds available on its platform since December 2021.
“iCapital is honored to help more financial advisors than ever grow their businesses by using our end-to-end technology and operating platform,” said Lawrence Calcano, Chairman and CEO of iCapital. “Our clients are and will continue to be the cornerstone of everything we do. Together, we’ve surpassed this 200 billion-dollar milestone in assets under management, and together we will innovate and transform the alternative investment experience to create opportunities for the long-term successful outcomes that financial advisors seek for their clients.”
iCapital has offices in Zurich, London, Lisbon, Singapore, Hong Kong, Toronto, and Tokyo this year. The firm will open offices in Australia and the Middle East in the next six months. The platform manages more than 28 billion dollars in assets.
AXA Investment Managers announced the launch of the AXA IM Wave USD Credit 2027 fund, an actively managed, three-year fixed maturity product (FMP) that will invest across a diversified portfolio in US-denominated investment grade and high yield debt.
The fund will have an investment grade average rating. The FMP aims to lock-in yields available in the current market environment and to offer investors an alternative to cash and money market investments over a period when short-term rates are expected to fall, the press release said.
The fund aims to mirror the profile of a single bond through a diversified portfolio that offers investors a combination of both investment grade and high yield investments.
The fund will leverage a dedicated 33-person US corporate credit investment team, with extensive experience managing short-term portfolios in US investment grade and high yield for more than twenty years. This marks the ninth FMP launched by AXA IM since 2015.
Frank Olszewski, CFA, Head of Investment Grade Active US Credit, and Vernard Bond, CFA, US high yield Senior Portfolio Manager will co-manage the fund. Both will be supported by the US Credit Investment teams.
The fund will continue to deploy AXA IM’s fundamental and disciplined bottom-up investment process, centered in selecting companies with robust fundamentals through in-depth credit research and diversification.
The fund is designed to be held until the fixed maturity date of December 15th, 2027, and open to new subscriptions until February 28, 2025.
Charles Schwab has just launched an RIA Roadmap with “a step-by-step approach to help you design, build, and launch your firm.”
The company highlights that transitioning to the independent RIA model “allows you to prioritize your clients and keep more of what you earn.”
According to the firm, those interested will find information and guidance on defining a business strategy, managing risks, setting up the office, converting accounts, and strengthening their practice.
To access the roadmap, please visit the following link.
FlexFunds, in collaboration with Funds Society, is pleased to announce the release of the II Annual Asset Securitization Sector Report 2024-2025, an in-depth analysis of the trends and challenges facing the asset management sector in a constantly evolving global economic environment. This report gathers the perspectives of over 100 investment experts and asset managers from 18 countries across Latin America, the United States, Europe, and Asia.
The report examines how the global economy has influenced asset securitization, identifying the most attractive sectors for asset managers and the strategies experts are adopting to navigate short- and medium-term changes. Download the full report here.
Key topics covered in the report include:
Main variables in 2024 and 2025
What are the most relevant variables when building or rebalancing an investment portfolio?
Most “securitizable” financial assets
Discover which groups of financial assets are most attractive for securitization.
Beyond conventional assets
Find out the experts’ conclusions on including alternative assets in portfolios.
Collective investment vs. separately managed accounts
What does the market think about the future of asset management? Will collective investment dominate, or will separately managed accounts prevail?
Challenges in attracting capital and clients
What is the biggest challenge in raising capital and acquiring clients in the world of investments and asset management?
The impact of technology
How does the use of artificial intelligence impact the asset management industry?
Tools and needs
The report reveals the advantages and disadvantages of various tools and needs in asset management, such as centralized account management and automated or outsourced NAV calculation.
The significance of this report lies not only in the quality of its data but also in the diversity of companies and experts who contributed to its creation. Companies such as Inversiones Security, Compass Group, Cucchiara & Cia, Dentons Ireland LLP, Harneys Fiduciary, Mason Hayes & Curran, AV Securities, Cix Capital, Black Salmon, and others provided their insights on the sector.
The II Annual Report of the Asset Securitization Sector 2024-2025 is an essential tool for industry professionals seeking to understand the evolving dynamics of asset management. With a comprehensive overview of future trends and challenges, this report offers valuable insights for building robust strategies in an increasingly complex financial environment.
In a market environment marked by uncertainty, ETF investors are not reacting excessively or nervously regarding their investments. Instead, they demonstrate remarkable calm and consistency, according to the 2024 edition of “ETFs and Beyond,” an annual study by Schwab Asset Management published this year to celebrate the 15th anniversary of Schwab ETFs.
The study shows that, in the face of market factors like volatility, recession fears, and the upcoming presidential elections, ETF investors found opportunities to lean more into ETFs or, more often, opted to remain cautious with their investments in these products.
Furthermore, amid the artificial intelligence boom that swept markets last year, nearly half of ETF investors stated that this trend has not influenced their approach to investing in ETFs, the report adds.
A full 97% of ETF investors are somewhat or very confident in their ability to meet their investment goals, and most feel secure that their portfolios would recover from a deep recession or a “black swan” event (75%).
“We have been studying ETF investors for over a decade, and during that time, they have consistently shown a long-term approach to investing and are not easily spooked by market headwinds. ETF investors can be described as steady, balanced, and fearless,” said David Botset, Managing Director, Head of Innovation and Product Management at Schwab Asset Management.
ETF investors remain committed to the classic 60/40 portfolio, with an average of 60% of their portfolios in equities and 40% in fixed income, though generational differences exist.
Millennials hold 54% of their portfolios in equities and 46% in fixed income. Overall, Millennials continue to show a greater interest in fixed income: 44% plan to increase their fixed-income investments next year, compared to 34% of Gen X and 26% of Boomers.
The primary reasons Millennials invest in fixed income are diversification (57%), income (56%), and reducing the risk level of their portfolios (49%).
ETF investors were more favorable towards various sectors and styles over the past year, and an increasing number plan to invest in cryptocurrencies through ETFs. Interest in U.S. equities, fixed income, and alternatives remained steady.
About 31% of ETF investments are in actively managed types, and 86% of investors responded in the survey that it is highly likely or somewhat likely that they will seek this type of management within the next two years.
Orion, the wealthtech solutions provider for fiduciary advisors, announced the launch of a new suite of ETF portfolios that utilize Capital Group products.
The portfolios, managed by Brinker Capital, are available exclusively on the Orion Portfolio Solutions (OPS) and Brinker platforms.
“This launch marks the introduction of one of the first models composed entirely of Capital Group ETFs, providing financial advisors and their clients access to Capital Group’s long-term investment strategies through Orion’s innovative offerings,” states the release accessed by Funds Society.
Capital Group manages more than $2.7 trillion in assets and has a global presence spanning 32 offices with over 8,800 employees.
“We are excited to offer these innovative ETF portfolios exclusively to our advisors. Capital Group’s long-term focus and strong investment strategies align perfectly with Orion’s commitment to providing advisors with the tools to help their clients succeed. This launch marks an important milestone in our relationship with Capital Group and in our continued efforts to deliver comprehensive wealth management solutions and a wide range of open architecture investment options,” said Ron Pruitt, president of Orion Wealth Management.
Additionally, Pete Thatch, Director of Wealth Management for National Accounts and Products at Capital Group, commented: “All our ETFs focus on the core asset allocation categories used by advisors when building portfolios for their clients and are designed to represent long-term, high-conviction investment horizons. Our ETF suite represents some of our investment group’s distinctive capabilities, with deep expertise and our proven multi-manager approach, and we are thrilled that Brinker has selected Capital Group ETFs to be part of these actively managed model ETF portfolios, available on the Orion platform.”
Key Features of the Brinker Capital Group ETF Model Portfolios:
– Dynamic asset allocation implemented by an experienced team: The portfolios are managed using Brinker Capital’s forward-looking dynamic asset allocation approach, designed to deliver client-centric long-term success. Brinker Capital has more than 20 years of experience managing ETF portfolios.
– Active management: Capital Group’s active ETFs represent some of its distinctive investment capabilities, with deep expertise and a proven multi-manager approach. Capital Group is one of the fastest-growing issuers of active ETFs, representing 19.7% of active ETFs that surpassed $1 billion in assets under management in the past two years.
– Accessible investment: With a minimum investment of just $5,000, Brinker Capital Group ETF Models are accessible to a broad audience.
