Despite the volatility in early 2016, most advisors plan to use products at much the same levels over the next 12 months as they have to date. For the minority who do plan to make adjustments, the most common changes are slight increases in allocations. Active ETFs were the product most commonly targeted for increase, with four in 10 advisors (40%) planning either a slight or significant increase in their use. Multi-managed products were a close second, with 39% of advisors combining in the increase column.
Advisors’ product plans were consistent across industry channels. That said, advisors from larger firms were more likely to plan on a slight increase in their use of multi-managed products (35%) compared to the broader industry average.
It’s worth noting, however, that interest in ESG products trails interest in the other products listed in the survey. Clients may be expressing less demand for these types of products than they are for active strategies—perhaps not a surprise considering the uncertain market landscape. Indeed, half of advisors (53%) surveyed viewed market volatility as having some impact on their choice between active and passive strategies. Only 20% said it had no impact.
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