The Daily Brief

Omaha Financial Advisor Running for State Office

Taylor Royal is running for Nebraska State Treasurer, change in the markets could hurt asset managers and StratiFi Technologies raises $7 million in funding.

A financial advisor from Omaha, Neb., is running to become the next Nebraska State Treasurer, KWBE.com is reporting. Taylor Royal is one of two Republicans in the state primary coming up on May 15. There is no Democrat in the race, so the winner of the primary will take office. Royal, who is a certified public accountant and personal wealth manager with Northwestern Mutual, says he has the financial background to do the job over his opponent, State Senator John Murante. If elected, Royal said he will advocate for property tax relief and for a curriculum in high schools that teaches sound financial principles in budgeting, saving and investing.

Market Appreciation Belies Problems for Asset Managers

Strong equity markets in 2017 drove asset growth of 14 percent last year among asset managers, according to a new report from Boston Consulting Group. Net new flows were 4.3 percent, the highest it’s been in the last 10 years. At the same time, asset managers’ revenues were up 9 percent. But that belies underlying pressures facing the asset management industry, and the business environment will change dramatically in the next five years, BCG says. Fees, for example, declined by 0.4 basis points during the year. If current trends continue, BCG estimates profit margins falling from 38 percent at the end of 2017 to 36 percent in 2021. But in a market correction, margins could fall as low as 27 percent. “Even tiring runners accelerate when the road turns downhill, because gravity works in their favor,” the report says. “That was the story of asset management in 2017. Assets under management, net inflows, and revenues were all well up, but not because asset managers made equally impressive improvements in their business models. Market gravity was on their side.”

Risk Analyzing Fintech Firm StratiFi Raises $7 Million

Abscent84/iStock/Thinkstock

Financial technology startup StratiFi Technologies, marketed as a hidden-risk identification tool, raised $7 million in a Series A funding round, the company announced. Investors included Anthemis Group, which also invested in robo advisor Betterment and SparkFin, a stock list-generating company purchased by StockTwits. StratiFi said the funding will be used to enhance its PRISM Rating product, a risk analyzer that can be used by financial advisors, and to develop educational tools to inform advisors and investors about risk-adjusted investing. “Institutional fund managers invest through a risk-oriented lens that mitigates all surface and hidden risks,” said Akhil Lodha, StratiFi’s co-founder and chief executive. “Our technology makes it easy for advisors to do the same and to communicate complex risk exposures in ways anyone can understand.”

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