Financial adviser numbers have stabilized in the United Kingdom after five years of sharp decline, according to a report from the Association of Professional Financial Advisers (APFA). According to the organization, the drop in advisers halted last year, but the cost of advice went up as regulators in that country banned commission-based selling of some financial products. “Two years after the Retail Distribution Review (RDR) was implemented it seems the adviser market started to stabilize in 2014,” said Chris Hannant, director general of the APFA. The total drop in the U.K. Over the five years was large, though, with 23,640 advisers working in firms in 2014 compared to 27,000 in 2009.
Interest rates remain low and should stay that way for a little while, according to Wayne Schmidt, chief investment officer for Gradient Investments, who adds that, as a result, investors and advisors should continue to capitalize on yield and overweight credit sectors and high-yield assets. That includes the fallen angel debt securities. Tom Lydon writes on ETFtrends.com that fallen angels, notably, the Market Vectors Fallen Angel High Yield Bond ETF, has out performed in the past year, increasing 7.2 percent. For comparison, the BofAML US High Yield Index only gained 2.1 percent.
Institutional investors, such as public pension funds, endowments and foundations usually lead the way on investing trends. Many advisors try to replicate their strategies for their own clients. But where do the institutions get their ideas? A recent study by Greenwich Associates found that nearly a third turn to social media for recommendations or decisions. Almost 80 percent of these investors use social media as part of their regular work flow. “These results show that social media is influencing decisions that can result in the allocations of billions of investment dollars around the world,” said Dan Connell, head of Market Structure and Technology at Greenwich Associates and author of the study.
To teach kids the four basic functions of money, Raymond James advisor Marc Gardner published The Four Money Bears earlier this month. The book is for kids aged 5 to 10 and introduces them to Spender Bear, Saver Bear, Investor Bear, and Giver Bear to help teach financial basics like, you may have guessed, spending, saving, investing and giving. But the book is only the start. Gardner’s project is raising funds to build a financial literacy educational "platform" called Money Bear Basics and to give the book out to low-income kids.