Every year, Morningstar suggests that investors buy fund categories that suffered the most outflows in the previous year. Often, such unloved funds are close to hitting a trough and are about to enjoy a revival, the fund tracker argues. So, what were the unloved of 2016? Large-cap growth, European stock and mid-cap growth were the most detested categories, Morningstar says. Some examples to consider include Vanguard Growth Index (VIGAX), T. Rowe Price European Stock Fund (PRESX) and the Hennessy Focus fund (HFCSX). History shows that this strategy tends to work. Since 1993, the unloved groups have outperformed the loved categories in most three-year periods. In 2015, the unloved had an annualized return of 9.39 percent, compared to a loss of 4 percent for the loved categories. “Over the long term, going against the crowd has improved results,” writes Dan Culloton, associate director covering equity strategies on Morningstar’s manager research team.
The inspiration for the 2013 hit film “The Wolf of Wall Street,” Jordan Belfort, has finally weighed in, often profanely, on the movie producers’ involvement in a multi-billion dollar Malaysian corruption scandal. Production company Red Granite’s head, Riza Aziz, was one of several named in a U.S. Justice Department complaint in July alleging that he participated in the illegal siphoning of hundreds of millions out of the 1MDB sovereign wealth fund. In an interview with The Hollywood Reporter, Belfort offered such gems as “[The movie] hadn’t even gone into production yet, and they threw a launch party. They must have spent $3 million on a launch party. They flew in Kanye West, and I said to [my fiance], ‘this is a f-ing scam, anybody who does this has stolen money.’ You wouldn’t spend money you worked for like that.”
Technology Vendors Ramp Up Integration
Technology companies are going full-steam ahead with integrations in 2017. Tuesday morning, Orion Advisor Services announced a new integration with TD Ameritrade Institutional that allows advisors to access real-time notifications of events from the TD custody platform within the Orion app. For example, if an account is funded at TD, the advisors will be notified in Orion. Just a few hours later, Redtail Technology announced a new integration with RIA in a Box that allows advisors to view and complete compliance tasks from within the Redtail CRM calendar. With advisor demand for consolidated and integrated technology growing, integration between technology vendors is likely to continue at breakneck speed.
Want The Daily Brief delivered directly to your inbox? Sign up for WealthManagement.com's Morning Memo newsletter.