The Securities and Exchange Commission's Office of Compliance Inspections and Examinations will conduct a series of exams putting the spotlight on mutual funds and exchange-traded funds. The office said the exams will take a hard look at whether retail investors could be taken advantage of and whether firms have fully complied with regulatory and legal requirements.
Fidelity data shows 50.4% of 401(k) balances were invested solely in a target-date fund in the third quarter. Advisors say the funds are good for younger investors but may not be right for those who have accumulated significant assets or started saving later in life.
While it is estimated the average 65-year-old couple will spend $280,000 on health care in retirement, breaking the cost down annually results in a much more manageable number and is something retirees can plan for, writes financial planner Michael Kitces. For instance, a study from Vanguard and Mercer Health and Benefits shows the median annual cost for a 65-year-old woman is $5,200.
A study by Prequin reveals that investors are likely to abandon pooled funds as their main route to investing in alternative asset classes over the next five years. Editor Chris Beales said the report, which found 45% of fund managers surveyed expect to see less investment through pooled funds, points to rising competition in the market.
The recent spike in market volatility hints at investors being unable to count on the Federal Reserve to bail them out through the so-called Fed put, writes Jim Iuorio from TJM Institutional Services. He adds, however, that while volatility measures are not predictive, investors who tap into market turmoil through their options strategy could benefit.
Brexit and the risk of business disruption has led buy-side investors to set aside reservations about fiduciary-management services as they look to ensure business continuity after the UK leaves the EU in March. Fund managers say that renting a fiduciary manager based in Ireland or Luxembourg lets them manage their existing EU-based funds and go after new business there post-Brexit.
Institutional Investor magazine's latest All-America Buy-Side Compensation survey shows the average fund manager can expect to earn $1.4 million this year. The figures reveal hedge fund portfolio managers can expect to bring in a base salary of $346,164 with an average of $1 million on top in performance-related pay.
The EU's rules forcing asset managers to pay separately for research and execution of client orders are being adopted in the US as good industry practice. However, Wall Street insiders say Markets in Financial Instruments Directive II has resulted in clients not only asking investment managers to pick up the tab for research but also challenging pricing structures to see whether they represent value for money.
Some advisory firms are starting to integrate "Alexa-empowered" voice technology into their offerings, but it could take a while for the technology to catch on widely, experts say. Concerns about the technology include data security and compliance issues.
Prenups are complicated, especially when there is a disparity of wealth, write Doug Baumoel and Blair Trippe of Continuity Family Business Consulting, who offer tips for making the process productive. "Rather than looking at a prenup as simply a negotiation about money in preparation for a potential divorce, consider instead that it's an opportunity to discuss how the engaged couple will integrate wealth into their lives together and manage the shared burden of wealth and/or the wealth disparity in their marriage," they write.