In new research from Cerulli Associates, the analytics firm offered up “eRIA” as an alternative term to “robo-advisor” for automated investment advice software. Whatever the advisory industry decides to call them, Cerulli said that the very existence of eRIAs are threatened by imitation from existing financial services companies. The technology forced companies to update legacy systems and the low-cost business model pioneered by companies like Wealthfront and Betterment may stick around, but existing companies have the resources to build their own (and Charles Schwab already has). Cerulli said the eRIAs may soon be forced to change their business models to become technology providers to advisors.
RCS Capital said its wholesale broker/dealer subsidiaries raised $476 million of total equity last month through 30 direct investment programs and registered investment companies, nearly 46 percent higher than February. The firm raised a total $1.1 billion during the first quarter. Two non-traded REITs distributed by the b/d, American Realty Capital Trust Global and American Realty Capital Healthcare Trust II, announced plans to IPO. Of the 31 investment products that RCAP distributes through its wholesale broker/dealer, 14 of them are affiliated with American Realty Capital Properties, which announced a $23 million accounting error last October.
As the NCAA’s March Madness tournament winds down (and people dream of the office pool windfall), Bloomberg did the math to find out how much people really bet on this annual bracket competition. Looking at legal gambling, the staff calculated fans place about $245 million in wagers. Doing some back envelope math, it calculated illegal bets total $12.5 billion—although the NCAA’s $2.5 billion estimate is much lower. Bottom line? It’s hard to tell, but there’s little incentive to discourage the gambling.
Tread carefully when getting into a discussion with clients about religion, writes Frank Paré on Money.com. Pare detailed a conversation he had with a potential client he describes as someone who could have won the award for "World's Best Grandma." Only, her reasoning for not having a financial plan? The End Times were near. His response: His role is to plan for the what ifs. That includes if she is off on her timing on the fate of the world. She did not become a client, but lesson learned: Debate about clients on the timing of the market, not the end of the world.