Enjoy the current installment of “weekend reading for financial planners” – this week’s edition kicks off with the huge industry news that Envestnet has purchased PortfolioCenter from Schwab, just months after Schwab announced that it was not going to create a full-scale upgraded cloud replacement to its still-popular platform, in what appears to be a tremendous strategic win for Envestnet (given both that Tamarac itself is built on top of PortfolioCenter, and that the acquisition gives Tamarac over 2,000 “new” PortfolioCenter desktop users to cross-sell their Tamarac cloud-based solution to).
Also in the news this week is a study from Cerulli finding that consumers do increasingly show a preference to pay their advisors with ongoing AUM fees or retainer fees… unless they’re mostly self-directed, in which case they’d actually prefer to pay commissions on each transaction as needed instead. And there’s also a fascinating recap of industry lobbyist spending in financial services, which finds that product manufacturing and distribution firms (e.g., fund companies, insurance and annuity carriers, and broker-dealers) spent more than $15M in lobbying last year, while advisor-centric organizations spent less than $300k… which goes a long way to explaining why the industry manages to keep defeating or watering down each proposed fiduciary rule!
From there, we have several articles on marketing, from tips on how to actually pick a specific niche or otherwise select an ideal target client (from the seemingly endless number of available choices), to why factors like “having at least $500,000 in investable assets” or “is a delegator” may be important “acceptance criteria” to selecting a new client (or not) but should not be part of the description of your ideal client profile (because they don’t define needs that you solve that would make you more referrable), and a series of tips on what you must consider when designing a good financial advisor website.
There are also a number of investment articles this week, from two articles that look at how the recent launches of zero-fee mutual funds are not actually attracting significant new asset flows (suggesting that perhaps consumers are either becoming wary of “free” from financial services firms, or simply that index funds have become “cheap enough” that price is no longer going to be the driver it once was), to another that looks at recent criticisms against index funds from regulators wondering if perhaps there are now too many behind-the-scenes conflicts for index fund providers in how they construct and execute their index funds.
We wrap up with three interesting articles, all around the theme of personal productivity and efficiency: the first is a fascinating look at how Aaron Klein of Riskalyze manages his increasingly busy email Inbox (and why despite the near email overload, he views email as his “secret weapon” and not a burden); the second explores the benefits of time-blocking, where entire days are set to one type of task (e.g., client meetings) or another (e.g., internal/staff meetings and prep) to reduce the amount of task- and context-switching that ultimately degrades personal productivity; and the last is a review of the recent book “Atomic Habits” by James Clear, which dives into how to actually change and improve your habits for the better, noting that improving by “just” 1% per day leads to a massive 3,700% improvement in the span of a year, and emphasizing that the key to achieving even massive long-term goals may not be in focusing on the long-term goal itself, but simply trying to establish the small short-term habits that can help you get on the right track… and then let the compounding of that habit carry you the rest of the way!
Enjoy the “light” reading!