Episodes
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This is a bittersweet moment. We are recording this on April 26, and April 30 will be my final day at VettaFi, after which I will no longer be associated with the Advisor Perspectives publication. This will be the final episode of the nearly 500 that I have hosted for the Gaining Perspective podcast.
There is no better topic to discuss in this podcast than the state of journalism in the advisory profession. “The profession of journalism exists, at its best, to inform and occasionally correct the record, to right a wrong, especially an awful thing that is wrong.” Those are not my words, but those of my guest today, who stands at the pinnacle of the journalism profession for advisors.
Here are some links on this topic:
Bob Veres’ Inside Information service - https://bobveres.com/ Bob Huebscher’s farewell article - https://www.advisorperspectives.com/articles/2024/04/23/farewell-robert-huebscher?topic=global-markets -
Tax-management strategies are crucial for clients, and they need today’s most sophisticated tools to relieve the tax burden for their clients. In this episode, my guest will dive into those strategies, such as tax-loss harvesting, and will explain how tax technology plays a significant role in driving value through smart, automated processes that find the right investment strategies for every client. We’ll also discuss why it’s important to deliver tax-loss harvesting with a purpose as well as some other hot topics affecting the advisory profession.
Here are some links to learn more about Hiren and 55ip:
55ip – www.55-ip.comTax Harvest Indicator (as of Dec. 31, 2023) - https://info.55-ip.com/hubfs/Marketing%20Library/55ip_TaxHarvestIndicatorQ42023.pdf
DISCLOSURE55ip is the marketing name used by 55 Institutional Partners, LLC, an investment technology developer, and for investment advisory services provided by 55I, LLC, an SEC-registered investment adviser. 55ip is part of J.P. Morgan Asset Management, the brand for the asset management business of JPMorgan Chase & Co. and its affiliates worldwide.
Telephone calls and electronic communications may be monitored and/or recorded. Personal data will be collected, stored and processed by 55ip in accordance with our privacy policies at https://www.55-ip.com/email-disclaimer/.
If you are a person with a disability and need additional support in viewing the material, please call us at 1-800-343-1113 for assistance.
The impact of a tax-loss harvesting strategy depends upon a variety of conditions, including the actual gains and losses incurred on holdings and future tax rates. The results shown in these materials are for illustrative purposes only and do not represent actual investment decisions.
The tax-loss harvesting service is available for an additional advisory fee and the results shown represent the net effect of the advisory fees but may not consider the impact of fees charged by others, including transaction costs or other brokerage fees. The information contained herein is subject to change without notice, is not complete and does not contain certain material information about the investment strategy, including additional important disclosures and risk factors associated with such investment and information about fees, trading costs and taxes.
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Episodes manquant?
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My guest today believes that the underperformance of the Magnificent 7 is creating opportunities in small-cap equities as investors look to loosen their portfolio concentration in large-cap names. In addition, increased small-cap M&A activity, better credit market conditions, and a lower cost of capital, are creating fertile ground for small-cap companies.
Here are some links to learn more about Rayna and Polen Capital:
www. Polencapital.com -
Most platforms for alternative investments are just concerned with getting advisors access to those investments. But advisors need education on the role alternatives can play in asset allocation and how creating portfolios that complement traditional assets drive business growth. My guest today will discuss:
How alternative investments benefit an RIA’s client’s portfolio and grow their business.Why access to alternatives is a given, and the focus should be on portfolio construction of alternatives with traditional assets.The unique demand among RIAs for different alternative investments, including private credit and infrastructure.Why semi-liquid alternatives funds may not be the best option for RIAs versus institutional offerings.Here is a link to learn more about Alan’s work and Crystal Capital Partners:
Crystal Capital Partners -
The advisory profession is sitting on the precipice of major cyber-related regulation set to impact advisors of all sizes. But RIAs are not cybersecurity experts; many are not prepared for the requirements expected to be released by the SEC, and it could negatively impact their businesses. The cost of a cyber incident and reputational damage is further amplified given the deeply personal nature of an advisor-client relationship, which is rooted in trust. My guests today will share advisors’ top concerns regarding cybersecurity, what cyber regulation looks like in 2024, and how advisors can calm client fears about the protection of their data.
Here are some links to learn more about Gabe, Mike and SEI:
Overview of SEI's cybersecurity offeringsOverview of SEI's offerings for RIAsGabe Garcia and Shauna Mace on Emerging Trends in the RIA Profession (Nov 2022) -
Private equity and venture capital funds have consistently outperformed public markets. But beyond those funds, there is a more specialized approach for investors to capitalize on the private markets: secondary transactions, often known as “secondaries.” My guest today, Andrew Krei, will navigate through the complexities of this dynamic sector, highlighting its potential rewards for investors seeking alternative paths for capital growth. He will also discuss the trends and advantages that the secondaries market offers over traditional PE or VC investments.
Show Notes
https://barrettupton.com/https://www.linkedin.com/company/barrett-upton-capital-partners/ -
How can financial advisors navigate the changing custody landscape and keep up with the ongoing demands of their clients? My guest will discuss the keys to advisor success, including how technology is impacting the profession, advisors' biggest pain points, unique offerings that firms should consider for their clients, and how to find the right custodian who will help during times of transition and periods of uncertainty. This episode is for any advisor looking to differentiate themselves in the market, considering a new custodian, or going multi-custodial.
Here are some links to learn more about Mike and Axos Advisor Services:
https://www.axosadvisorservices.com/https://www.linkedin.com/in/michael-watson-33222a1/ -
Most clients have no idea what retirement failure means to them and how a given failure rate should influence their planning. My guests today will present a planning framework that improves existing models by dynamically adjusting for market performance and longevity.
When saving for retirement it’s common for advisors to evaluate progress toward a savings goal and recommend course corrections to stay on track. Making course corrections after retirement means that the retiree must either spend less if investment returns are low or be able to spend more if markets rise.
Clients need to understand how investment and longevity risk will affect their lifestyle as they make these adjustments to avoid running out of savings. The best way to understand how these risks might affect their lifestyle is through a visualization of spending paths. Visualizations are a powerful and accurate way to understand how spending more early in retirement, taking greater investment risk, and using an annuity change the course of possible lifestyle paths.
Here are some links to learn more about Tamiko, Michael and IncomePath:
www.incomepath.comhttps://www.linkedin.com/company/incomepathGiving Retirees the Freedom to Spend -
Amid higher interest rates and consequently higher yields, investors have piled into cash. My guest today will explain why it’s time to make a move. His position is that cash should be an asset to provide for short-term (less than 12 months) liquidity needs. Beyond that, investors should consider an appropriately diversified portfolio to achieve their financial goals. While short-term performance may work in investors’ favor, he will argue that over the long term, the benefits of being invested outweigh the potential short-term benefits of sitting in cash.
Here are some links to learn more about Seth and Janus Henderson:
Sitting in cash? What’s your next move? - Janus Henderson InvestorsLate to the party: Are the best of money market returns behind us? - Janus Henderson Investors -
Change is happening all around us at an accelerating rate. To exploit that change, rather than be exploited by it, professional advisors need power and capability that is protected by true independence. My guest today is a pioneer of the business model that was created to deliver that combination, what is now called outsourced chief investment officer (OCIO).
Jon Hirtle will explain why he is just as passionate about power, capability and true independence as he was when he founded an industry and a firm over 35 years ago. He has been an active investor and successful entrepreneur for 40 years and I look forward to discussing the lessons he has learned as well as the trends he finds compelling.
How do good RIAs become great ones? How do $1 billion-dollar practices become $20 billion-dollar practices? Today, I talk with someone who has done both.
Here are some links to learn more about Jon and Hirtle Callaghan:
Jon’s emai: [email protected] https://www.hirtlecallaghan.com/https://www.hirtlecallaghan.com/blog/ -
Diversification is a core principle of sound investing, but building a diversified portfolio is much easier in theory than in practice. In the recently published “2024 Diversification Landscape,” portfolio strategist Amy Arnott of Morningstar took a deep dive into the diversification potential of several major asset classes. As advisors build their clients’ portfolios, there are a few lessons from this research. First, it is impossible to predict which asset class will do well in any given year. Holding a variety of asset classes helps guard against being overly exposed to an area that falls out of favor. Second, while the correlation between stocks and bonds has increased, bonds still provide relatively strong diversification benefits. This means that the classic 60/40 portfolio is tough to beat, having produced returns of about 18% in 2023. Third, the asset classes with the strongest diversification benefits may come as a surprise to some advisors. Real estate is a questionable diversifier despite its popularity, while cash is a strong diversified.
Show Notes
Here are some links to learn more about Amy and her research:
Get the full report: 2024 Diversification Landscape -
The multi-trillion-dollar ESG fund industry faces a regulatory problem. By the end of 2025, funds with net assets of $1 billion or more must comply with the amendments to SEC Rule 35d-1, better known as the “names rule.” It requires funds with names that include ESG terms have at least 80% of the fund invested in assets that aligned with those terms. The amendments strengthen prospectus disclosure requirements, and mandate that terms used in the fund’s name suggesting an investment focus be consistent with their plain-English meaning or established industry use.
My guest today will explain how ESG has become a meaningless term to investors. The result has been massive flows to ESG funds that have large holdings in oil companies, agricultural chemical manufacturers and similar companies that many investors are not aware of. Fund managers are struggling to explain what is going on, as they must to comply with the names rule.
Show Resources
Reflection Analytics Launches Digital Platform for Comprehensive ESG Audit and AnalysisSEC Adopts Rule Enhancements to Prevent Misleading or Deceptive Investment Fund NamesReflection AMReflect website
Here are some links to learn more about Jason and Reflection Asset Management: -
Today’s technology-driven landscape makes it easier than ever for RIAs to embrace automation across their tech stack and supercharge their businesses. Advisors can save time and minimize errors by using trading and rebalancing tools, portfolio management and CRM systems to manage accounts. Automation in data analysis also frees up time to provide more personalized advice or pursue new business. During this episode, Steve Sanders of Interactive Brokers will cover How automation increases operational efficiencies for advisors, why data aggregation and integrated reporting are critical to serving clients holistically and so much more.
Show Notes
Interactive Brokers home page: https://www.interactivebrokers.com/en/home.phpInteractive Brokers page for RIAs: https://www.interactivebrokers.com/en/accounts/advisor.php
Below are some links to learn more about Steve and Interactive Brokers: -
With nearly 4.5 million Americans turning 65 in 2024, advisors are navigating four core risks that will impact their portfolios in retirement: longevity, inflation, volatility, and emotions. We will discuss new research by Dr. Wade Pfau, professor at The American College of Financial Services. He did this research on behalf of Equitable to look at how to improve the efficient frontier, enhance risk-adjusted returns and help advisors – and their clients – make the most of their assets through their retirement.
The research looks at the role of a registered index linked annuity (RILA) with lifetime income for a portion of a portfolio and the resulting impact on meeting lifetime spending goals, preserving assets and managing volatility as part of an overall retirement plan.
Show Resources
Here is a link to learn more about Wade, Pete and Equitable’s offerings:
Equitable’s retirement guide: https://equitable.com/financial-professionals/annuities/tool-center?utm_source=rgnov23 -
Large international index funds do not account for geopolitical risk. Corruption has costs, and in this age of conflict with rising tensions in the Middle East, Russia, Ukraine and elsewhere, investors are faced with a daunting landscape while US markets are near highs. Should investors ride the momentum or transition and rotate to sectors that represent greater value and higher forward expected returns? The traditional international funds are attractively valued relative to the US but are fraught with risk. Today we will hear from Julie Cane and Chris Browne from Democracy Investments to discuss democracy as a factor in international investing.
Show Resources
Here are some links to learn more about Julie, Chris and Democracy Investments:
To learn more about Democrqacy Investments, and the DMCY fund visit https://www.advisorperspectives.com/pdfs/2024/DI-Overview-3_20_24.pdf Please find more information and important disclosures at https://www.democracyinvestments.com/fund -
Let’s explore the world of cash. One year after the collapse of SVB, fiduciaries need to understand the cash management platforms on the market, including the fine print that can make or break a client relationship. The right platform will help the advisor provide more holistic advice and grow their AUM organically. My guest will discuss what advisors need to know about cash sweep accounts and how advisors can evaluate different platforms. We hope to provide a better understanding of the cash management landscape, the inherent conflicts of interest that occur, and how to talk to clients about cash.
Show Resources
Here are some links to learn more about Gary and MaxMyInterest:
www.maxforadvisors.com The Impact of Active Cash Management -
On March 8 of this year, BlackRock announced its agreement to acquire the remaining equity interest in SpiderRock Advisors, LLC, a leading provider of customized option overlay strategies in U.S. wealth markets – a move that builds on BlackRock’s minority investment in SpiderRock, made in 2021, and reinforces BlackRock’s commitment to personalized separately managed accounts.
Led by President and Chief Investment Officer Eric Metz, SpiderRock Advisors is a Chicago-based asset management firm focused on providing customized option overlay strategies to investors. The company excels in innovating options strategies, making them a vital asset class for institutions and advisors. By combining technology with comprehensive derivative management expertise, SpiderRock Advisors is committed to making it easy for financial advisors and institutions to add option overlay strategies to their portfolios. SpiderRock Advisors manages approximately $5 billion.
Show Resources
Press release (March 8, 2024): BlackRock to Acquire SpiderRock Advisors- https://ir.blackrock.com/news-and-events/press-releases/press-releases-details/2024/BlackRock-to-Acquire-SpiderRock-Advisors/default.aspx
Web site: www.spiderrock.com- http://www.spiderrock.com/
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Investors are choosing bonds in record numbers – in 2023, global bond ETFs gathered an annual record of over $300 billion in flows with iShares leading with $113 billion. My guest today will explain why this will continue, as many investors are still significantly underweight to fixed income, with a 22% average allocation. You will hear why investors need to step out of cash and move faster into fixed income because, historically, the market has priced in rate actions long before they occur.
Show Resources
BlackRock Flexible Income ETF (BINC)BlackRock Total Return ETF (BRTR)iShares iBonds ETFsiShares High Yield Systematic Bond ETF (HYDB)iShares Core U.S. Aggregate Bond ETF (AGG)iShares Core Total USD Bond Market ETF (IUSB)iShares Broad USD High Yield Corporate Bond ETF (USHY)iShares J.P. Morgan Broad USD Emerging Markets Bond ETF (BEMB)BlackRock AAA CLO ETF (CLOA)
Here are some links to learn more about Steve and BlackRock: -
The easiest new client to get is the one that you don’t lose. Focusing on client retention is the key to the success of any business – whether you are an RIA or FA with 300 clients, or a mutual fund manager with 300,000 or three million shareholders. What are the lessons learned from past periods of stock and bond market stress applicable to client retention? How can regulators, watching the mutual fund industry and the advisory profession – so important to the national’s retirement savings – benefit from these lessons?
Show Resources
A like to the latest study: https://www.linkedin.com/feed/update/urn:li:activity:7174395341968920576/ 2015 study: https://static1.squarespace.com/static/579505b4b8a79baa23c97c61/t/65b51ddbba4ee864a636622b/1706368477762/Strategic+Insight+Study+-+Mutual+Funds+and+Systemic+Risk%2C+March+2015+%28FSOC+Submission+Docket+2014-0001%29.pdfAvi's LinkedIn page: https://www.linkedin.com/in/avinachmany/Avi's personal web site: https://www.avinachmany.com/
Here are some links to learn more about Avi and his work: -
The economy, inflation, interest rates and market valuations drive the key questions facing advisors. Does the tech stock landscape mirror the boom of 1996 or the bust of 2000? What will be the impact of Meta's inaugural dividend payment? Is now the time to increase allocations to international Markets? What are the challenges faced by retail banks by not providing competitive rates and the resulting opportunity cost of holding cash? Finally, we will address the complexities advisors face in investment management, client growth, and retention.
Show Resources
Here are some links to learn more about Jeremy and Wisdom Tree Financial:
Jeremy Schwartz | ETFs (Exchange Traded Funds) & ETF Investments from WisdomTree- https://www.wisdomtree.com/investments/jeremy-schwartz2024 Economic Outlook & Market Signals | WisdomTree- https://www.wisdomtree.com/investments/strategies/on-the-markets - Montre plus
