Rating systems can play an important role in helping advisors select and monitor appropriate investments on behalf of their clients. Fi360, a Pittsburgh-based fiduciary education and technology company, specifically built the Fi360 Fiduciary Score® rating system as a transparent and objective investment rating system used to evaluate a variety of funds through a fiduciary lens.
The Fiduciary Score is used to evaluate over 75,000 investments and determine their fiduciary appropriateness. The score is an important part of Fi360’s larger mission of empowering financial intermediaries to use a prudent process to profitably gather, grow and protect investors’ assets with a fiduciary standard of care.
Bill Mueller, CEO of Fi360, says the Fiduciary Score is unique because it’s specifically designed to help advisors fulfill these needs. “There are a lot of different sources that provide returns data or other quantitative analysis, but ours is really the only peer investment ranking system that helps investment managers meet their fiduciary responsibilities,” he says.
Historically, the Fi360 Fiduciary Score only rated open-ended mutual funds and ETFs. Now, the Fiduciary Score includes collective investment trust (CIT) rankings. CITs represent about a fifth of retirement assets and are gaining in popularity, according to Mueller. However, because they don’t trade on an exchange, these investments are less transparent than mutual funds and more difficult for advisors to evaluate. By including CITs in the Fiduciary Score, Fi360 now can offer retirement advisors a reliable method for developing an investment strategy that meets clients’ needs.
Today an estimated 4,000 investment professionals use the score, which is published monthly. In addition to the rating system, Fi360 provides investment management software that helps advisors implement a repeatable, prudent process that is easily managed and documented, educational programs that teach financial professionals about fiduciary responsibilities, case law and industry best practices, and data and analytics that can be used in marketing materials and presentations to demonstrate a prudent process.