Maybe actively managed funds underperform their passive counterparts not because of stock selection, but because most active fund managers just charge too much. John Rekenthaler at Morningstar did a bit of number crunching and found that in large-cap and small-cap, the cheapest actively managed funds (those with fees in the bottom 25 percent of its group) perform better when compared to the returns of all passive funds; only in mid-cap did the cheapest active funds still underperform the passive (and passive funds regain the advantage when comparing cheap to cheap.) The outperformance of the cheapest actively managed emerging market, foreign stock blend and international bond categories was even more pronounced.
Investors have been taking advantage of low interest rates for a long time now, and the trend is continuing, reports Wells Fargo. In a survey conducted last month by Gallup Investor of over 1,000 U.S. adults, over half (58 percent) reported benefiting from lower rates. About one third had, over the past two years, taken out a car loan, while 16 percent took out a mortgage for a new home and 17 percent took the opportunity to refinance an existing mortgage or home loan. And about half of investors surveyed say they are very or somewhat likely to take out a loan soon in anticipation that rates may go up.
At FolioDynamix’s annual conference in Colorado, the wealth management technology company introduced a new investor portal for advisors to use with their clients. The portal lets investors access their account information, investment strategy and portfolio performance anywhere and on any device, and advisors can use it to share documents and collaborate with clients. FolioDynamix also integrated with Docupace Technologies to pre-populate and process required client documents, creating what it calls a “turn-key straight-through processing solution to the wealth management industry for new account openings.”
The market for high-end fine art is booming again, writes Russ Alan Prince for Forbes, and, as a result, so is the need for astute wealth management. The ultra wealthy are buying art not just to hang on their walls as status symbols, but as part of their investment portfolios and, looking ahead, as significant pieces of their estates. To help collectors, wealth managers should set up strategies to mitigate taxes due when selling or gifting the art. In addition, they should set up multi-level succession plans to address potential philanthropic plans down the road, says Rick Flynn, managing partner of FFO Business Management & Family Office. A captive insurance company is also a smart tool to use to customize coverage and define what to do should something bad happen.