Top Asset Managers

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Nov 2, 2010 5:12 pm

Hi all,

I wanted to introduce myself: My name is Diana Britton, and I just came on board at Registered Rep. as a new Staff Writer. Feel free to call or email me if you'd like to talk or simply introduce yourself. I can be reached at [email protected] or 212-204-4363.

My beat will include asset management, but I'll likely be writing on a range of topics as well.

As I get the lay of the land here, who do you think are the top money managers we should be covering?

Nov 2, 2010 5:23 pm

Hedge Funds...

Nov 2, 2010 5:26 pm

Vanguard ETFs and the subaccount managers of every top rated insurance company.

Nov 2, 2010 5:38 pm

I think the big story is "How do top managers re-create trust with Registered Reps"

I find their lack of credibility alarming... I'll manage the money thanks.

Nov 2, 2010 6:01 pm

Well they have to deliver value, first. I think you are really interested in costs?

These managers could start with delivering some cost effective value. Slash fees, at least improve the ratio of active management/index performance.

It would be cool to have some branded products you could trust in terms of cost/performance, especially for smaller accounts.

How about uncovering some really good balanced funds for one stop shopping?

Nov 2, 2010 10:06 pm

The managers garnering the most interest today are those that take a tactical approach. Style box managers hold no interest for most of us, because they will stand in front of a freight train coming at them, because it says in the prospectus that is what they should do.

Thats why MF's like Blackrock Global Allocation, and SMA managers like Riverfront are getting the most attention. And thats also why more and more FA's are managing the money themselves.

Nov 2, 2010 11:12 pm

Don't ask the asset managers to slash their fees -that's been done already.  That 1.5% wrap fee your client is paying, the manager maybe getting 32-38bps.  Maybe you should take a fee cut yourself and the Wrap Sponsor.

Nov 5, 2010 1:15 pm

Gano, I don't know if b/ds could charge lower admin fees, but that would help managed funds. Otherwise, it's mainly ETFs and a "higher" fee for me on smaller accounts. Don't see the sense in running 12b1s through the grid and so on, active management is not worth it in cost/benefit to the client or the advisor.

Nov 5, 2010 2:49 pm

Diana I'm very, very frustrated with mutual fund firms, and their "professional" wholesalers.

Stop trying to sell me the hot sector, fund. I know EXACTLY what that leads to. Also, take the time to really find out who I am as a rep, and what kind of clients I have. It's called PROFILING....

When a firm shuts down a fund, and rolls it into another, causing me grief, and tax issues for the client, I'm going to be very PO'd, so don't do that very often, or better yet, don't put your firm into that position in the first place!

If you have a value fund, I expect it to be value. It's amazing what happens when you look deep into a fund, and see massive style drift.

I'm personally responsible to clients for failure, have to apologize and pay the price. Fund families are very reluctant to act the same way.

Never refer to my client, as a "mutual" client. I've had folks at two firms call my clients that. And after I've repeatedly asked them to stop doing that, they continued. How pathetic... Both firms later blew up upon themselves too.

A fund family that I support, if I call them for some financial support, and you give me some bs song and dance about this and that, I'm not only going to fire you, I'm going to tell all my friends about how I gave you millions upon millions over the year, but when I asked for $500 is support, you balked. Man, you are on my bad list forever...

I really think too, that some of these fund families use a smaller less known fund, as a dumping ground for better funds. I think there are all sorts of illegal and unethical tactics used, via market making, bid rigging, etc. My skepticism here, has only been confirmed over the years. 

ETFs, don't even get me started. Indexes, and index rebalancing is a perfect way to steal money. Those indexes are constantly changing, and the folks that make those decisions profit from it.

Diana, how about that? Just off the top of my head for starters... 

Nov 5, 2010 3:44 pm

ETFs, don't even get me started. Indexes, and index rebalancing is a perfect way to steal money. Those indexes are constantly changing, and the folks that make those decisions profit from it.

And I'd like to know how an index like VTI, Vanguard Total Market, MSCI US Broad Market, with 3,410 holdings and an expense ratio of .09, is stealing money.

Or do you mean actively managed indexes, in which case, what do you mean, ETFs, don't get me started?

I get how cash inflows into indexes may move the market, but I don't like active management.

Nov 5, 2010 3:50 pm

Times, they manipulate the make up, change the holdings and percentages more than you'd think. There are winners and losers when you move money like that, and if you are the guy making the decisions of scaling down, or up, you can move the market. .09, yeah, whatever. Check out "transaction costs/fees/admin" which are separate line items. Also, "paid research"....

Dude, nothing is on the up and up...

Nov 5, 2010 3:59 pm

Hah ha, well, that makes me feel better about mixing ETFs and managed funds. No perfect market.

ONly us, we're on the up and up.

Nov 5, 2010 4:37 pm

BFP - Can you elaborate and provide references? I am not familiar with what you are talking about and have heard it twice now in two weeks (not you both times). Is this something MF wholesalers are using to argue against all the money going into ETFs?

Nov 5, 2010 5:05 pm

My comments, about cutting prices, was concerning SMA Managers - not Mutual Fund Managers.

Nov 6, 2010 10:25 pm

Times7, yes, after my length of career, no u4 issues, I'm on the up and up.

N.D., just look up the research/admin costs in the annual reports.... While you're at it, look up the annual report of your favorite annuity company and see the millions upon millions they pay for "research and advisory"...

Humor yourself further. Print out some well known indexes now. Then, in about 6-9 months, pull up the holdings again. They change, a lot... And again, when you are moving tens of millions, if not hundreds of millions, it provides a most wonderful front running experience. Pennies here, pennies there, multiplied by tens of millions of pennies... Just like the late trading of international funds back in the day.

Hey, maybe if we just gave more power and money to the regulators, and imposed more idiotic regulations upon the pawns (us RRs), this could all be fixed..... /s