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Merrill Edge Is Making Fund Research Easier for DIY Clients

The new way of presenting fund information has been available to Merrill Lynch Wealth Management advisors for some time, demonstrating how BofA’s offerings in wealth are converging, regardless of where the client sits.

It’s not clear how long discount brokers can compete on price, so some DIY brokerage platforms are trying to bring more value by enhancing the tools that clients have access to. Merrill Edge, Bank of America’s self-directed investing platform with more than $200 billion in assets, wants to make sure it stands out from the competition in part by making it easier for investors to do quick, comprehensive research on mutual finds and exchange traded funds via a new tool unveiled last week.

The new “Fund Story” feature lets investors evaluate funds quickly, a spokesperson said, with information on holdings, ratings from third-party evaluators, costs, analysts recommendations and environment, social, governance fund scores from MSCI.

The same research and information was already available on Merrill Edge, but would have taken an investor more than a few mouse clicks and a large amount of time gathering it on their own. Cory Triolo, the head of digital client experience for Merrill Edge, told that investors found the data was “information overload” before the recent changes. The new walk-through of each fund might only be a minute or two now for investors to get the same information.

Merrill Edge, which includes discount brokerage services, managed investment portfolios and access to financial advisors, began overhauling the user research experience in 2015. In November of 2017, it unveiled the first Fund Story experience for individual stocks, then did the same for client portfolios in early 2018.

As with other moves made by the bank and its wealth management division, all services are converging into a menu of offerings independent of where the clients sit inside the bank. Similar resources have been available to Merrill Lynch Wealth Management advisors and institutional investors who’ve worked with the firm for a long time, Triolo said.

“I think the way they have laid out self-directed and [Merrill Edge] Guided Investing, they’ve got the right mindset,” said Gavin Spitzner, president of Wealth Consulting Partners, a firm that helps wealth managers execute high-level strategy changes. Some wealth managers have been more hesitant than others to improve or expand their self-directed or automated investment services for fear of cannibalizing their advisory business, but Merrill Lynch has overcome that challenge better than others, Spitzner said. 

Spitzner said he was impressed with the Merrill Edge research experience and that it was better than what he’s found at competing discount brokerages. “It’s grounding the client,” he said. “It puts some context around things to be thinking about based on performance and goals.”

Along with improving the digital experience, Merrill Edge plans to open 600 new investment centers in 2019, both in Bank of America branches and in new locations, bringing the total to 2,800, as the bank and wealth management businesses integrate further: something Andy Sieg, the head of Merrill Lynch Wealth Management, said was the preferred service offering for modern consumers.

Dennis Gallant, a senior analyst at Aite Group, a research and consulting company for financial services firms, said competitors hoping to coax investors away from Merrill Edge are increasingly going to have a more difficult time. Once investors are accustomed to a better research tools and more cohesive experiences across services, they will expect it from all service providers and be less apt to make a change when they can’t find it, he added.

“It does set the bar a bit higher in regards to the client experience,” Gallant said. “It does raise the stakes.”

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