SUBSCRIBERS NOTICE: This newsletter is taking a break for Christmas and won’t be published on Thursday and Friday. It will resume on Monday, Dec. 28. A lesser-known stock index lost its biggest driver after Tesla Inc. joined the S&P 500, potentially undercutting the performance of the highflying benchmark and several exchange-traded funds that track it. The S&P Completion Index tracks all U.S. stocks except those in the S&P 500. The index is typically associated with mid, small and microcap stocks that fail to meet certain criteria for inclusion in the S&P 500. The presence of Tesla, the biggest stock in the completion index and the sixth-largest publicly traded company in the U.S., was something of an anomaly. Below, some of the best … [Read More...]

Chicago-based Hightower announced it helped one of its advisory businesses, Fischer & Company, to merge with Stralem & Company to create a wealth management firm advising on about $800 million in client assets. Both merger partners are based in New York. The combined business will have 13 employees, including five advisers, and go by the name of Fischer Stralem Advisors. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, on investing, the wealth-management business and more. CORONAVIRUS OUTLOOK Covid-19 Closed Borders and a Once-Hot Apartment Market Crumbled: Australia has been hit hard by sagging demand because immigrants and foreign students have been shut out. PLANNING & INVESTING Investors Turning Up Noses at Food … [Read More...]

David Friedman, founder of wealth information and insights provider Wealth X, told Barron’s that many financial advisers are reporting accelerated client acquisition in 2020—with many even seeing record years—despite the economic hardships wrought by the pandemic.  Regardless of whether this describes your firm or you’re having a more difficult time, all advisers should have one top of mind: How to either build or keep momentum and pipeline velocity as the calendar turns to 2021. To sustain and fuel growth, advisers will need a new mindset and framework that leverages the skills they use in managing their client’s portfolios, and transplants those same skills to an often missed but critical asset of their client: the social capital comprised of their relationship networks. Below, some of the best analysis and … [Read More...]

LPL Financial’s adviser headcount is about to jump by more than 900 via a single deal. The nation’s largest independent broker-dealer has agreed to pay $300 million for Waddell & Reed Financial’s wealth management business, which serves 921 independent advisers providing advice on $63 billion in assets. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, on investing, the wealth-management business and more. CORONAVIRUS OUTLOOK Covid-19 Vaccines Start a Frenzy for Dry Ice; ‘It’s Like a Herd of Mustangs’: Holiday food shipments also boost orders for solid carbon dioxide. PLANNING & INVESTING The Market Should Worry About 2022, Not 2021: Covid-19 vaccines make it likely that next year’s profit expectations will be met. Forecasts for a boom … [Read More...]

During the Covid-19 pandemic, investors’ use of wealth management mobile apps has increased, according to a new J.D. Power study. That’s the good news. The bad news? Investor satisfaction with the apps lags that for other industries, and wealth management firms are missing opportunities to use the technology to boost customers’ interactions with advisers, J.D. Power says. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, on investing, the wealth-management business and more. ELECTION DOL Fiduciary Regulation for Retirement Plans Is Now in Limbo: Delays make Department of Labor’s proposed rule vulnerable to being scrapped under the Biden administration. CORONAVIRUS OUTLOOK Lessons From Europe’s Covid Surge: Control Is Fragile and Losing It … [Read More...]

Venture capitalists are beginning to heed calls to increase racial and gender diversity in their ranks and investment targets, according to a new survey from Morgan Stanley. About three in five venture capitalists surveyed said the Black Lives Matter movement had influenced their investment strategy and more than two-thirds said they are more likely to invest in multicultural-founded companies in the coming year, the bank said Thursday. “With 2020 as a potential pivot point on these issues, we push ourselves, as well as our industry, to become more honest and introspective about our attitudes, biases, actions and barriers to addressing inequality,” the report said. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, … [Read More...]

The advisory business has become increasingly commoditized and competition has blurred the lines between firms. Firms and brands are less delineated, diminishing loyalties. This dynamic, disruptive environment has made client acquisition and business hyperchallenging. Which prompts two questions: What is the alpha your clients get by working specifically with you? And what is the excess value you add to your own practice to separate yourself from competition? Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, on investing, the wealth-management business and more. ELECTION CFOs Watch for a Possible Minimum Wage Hike Under Biden:  Companies are considering raising prices, cutting workers’ hours and investing in automation to offset a potential rise in labor costs. … [Read More...]

Jacob Sonenshine wrote in Baron’s that the election results could blunt the economic recovery, pressure interest rates—and support just enough stocks to lift the S&P 500 to a record high. To be sure, the faster the economy reaches pre-covid levels of output, the faster earnings per share on the S&P 500 come in at the $163 level 2019 saw. But the speed of the recovery hinges somewhat on heavy fiscal stimulus. With Vice President Joe Biden and President Trump locked in a close race, and Congress split between a Republican Senate and a Democrat-controlled House, a $3 trillion stimulus bill is almost certainly not going to happen. That means lowered inflation expectations, and lower Treasury yields. Those low rates are a key support for stocks, explains … [Read More...]

Wells Fargo has seen an exodus of financial advisers over the past few years amid multiple scandals that have tarnished the bank’s reputation. Now the company is laying off some advisers as it looks to cuts costs in a low-rate environment that amounts to a headwind for banks. During the third quarter, the number of advisers at the bank’s brokerage unit, Wells Fargo Advisors, fell by 390, or 2.9%, to 12,908. “While this change represents retirements and some natural adviser attrition, it also includes the displacement of a sizable group of salary/bonus advisers as a result of the company’s work to become as efficient as we can,” spokesperson Shea Leordeanu said in an email statement. “Wells Fargo has been transparent that we expect to reduce the … [Read More...]

Michael Nathanson, chairman and CEO of the independent wealth management firm Colony Group, told Barron’s that robo-advisers have a role to play in serving certain client segments. As for the industry’s continued shift toward client-centric wealth management advice and away from the investment-only models of the past, I think the shift can’t be completed quickly enough. Does the evolution in the industry come down to financial advisers doing a better job embracing new technologies? We must all do so, but simply committing ourselves to using more and better technology isn’t committing ourselves to meaningful, evolutionary changes. In fact, it may merely be masking the need for such changes. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones … [Read More...]

Few advisers could have foreseen a year like 2020, with a highly deadly pandemic emptying workplaces from coast to coast, turning the markets upside down (and back again), and battering the economy. And that’s not to mention this year’s widespread social protests and intense political polarization. But if 2020 has brought unique problems, it has also set the stage for proactive advisers to really grow, says Jud Mackrill, chief marketing officer at Carson Group, an RIA with $12 billion AUM based in Omaha, Neb. “I see a very clear opportunity for advisers to seize this moment,” he says. “This is a time for advisers to mature the marketing side of their business to really tackle the challenge of growth in this season of uncertainty.” Below, some of … [Read More...]

The third quarter isn’t even over, but mergers and acquisitions involving registered investment advisor firms already have notched a quarterly record. There have been 36 deals so far in the quarter, breaking the previous record of 35 set in the first quarter of this year, according to DeVoe & Co., a consulting firm and investment bank that focuses on the wealth management space. Other deals that are in the works and could be announced or signed before quarter-end likely will lift the total to more than 40, the firm added. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, on investing, the wealth-management business and more. CORONAVIRUS OUTLOOK Companies Adjust Earnings for Covid-19 Costs, but Are … [Read More...]

Raymond James is cutting nearly 4% of its global workforce, according to published reports. The St. Petersburg, Fla.-based financial-services company has 13,900 employees world-wide, which means it will eliminate about 500 jobs, ThinkAdvisor reports. No advisers will lose their jobs as part of the cuts, a spokesman tells the Tampa Bay Times. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team and occasionally beyond, on investing, the wealth-management business and more. CORONAVIRUS OUTLOOK Hospitals for Years Banked on Lean Staffing. The Pandemic Overwhelmed Them: Health systems have kept a tight rein on employee numbers and expanded outpatient care, helping their finances but making them less prepared for a medical crisis. The coronavirus pandemic set off a … [Read More...]

Financial advisers who aren’t using behavioral finance techniques may want to add them to their tool kits in the wake of a new survey commissioned by Charles Schwab Investment Management. The survey, conducted by Cerulli Associates, found that more advisers are employing the techniques this year than last, and they’re seeing clear benefits. Behavioral finance studies the way psychology and emotions influence financial decisions, and if there ever was a year to test investors’ mettle, 2020 was it. Concerns about the coronavirus’ impact on the economy pushed stocks off a cliff in February, but then government action and hopes for economic recovery helped to fuel an explosive, if volatile, rally. Below, some of the best analysis and insight from WSJ writers and columnists, the Dow Jones Newswires team … [Read More...]