Foto: Craig Sunter
. Betterment lanza un servicio que completa su oferta digital con humanos
Betterment, the largest independent online investment advisor, yesterday announced the next evolution of the company with the release of a new service offering, expanding the company’s platform beyond a single digital product to a multi-plan advice offering that includes access to CFP® professionals and licensed financial experts.
The company can now meet the needs of its customers however customers want to invest and receive advice, whether it’s through the existing digital offering or also working in conjunction with a team of licensed experts. This team will help customers monitor their accounts, answer their financial questions, and give them advice. The new plans give customers the best of both worlds— smarter technology and access to financial experts:
Betterment Digital: Customers gain access to our current award-winning technology, with tax-efficient algorithms and digital advice, at an incredibly low cost.
Betterment Plus: Customers receive an annual planning call from a team of CFP® professionals and licensed financial experts who also monitor their accounts throughout the year.
Betterment Premium: Customers get unlimited access to a team of CFP® professionals and licensed financial experts who monitor their accounts and give them advice and financial planning throughout the year.
Customers who would like a full-time, dedicated independent financial advisor can be referred to an RIA who uses the Betterment for Advisors platform to manage its clients investments through its recently announced Advisor Network.
The firm will now charge a flat 0.25% for its Digital plan, 0.40% for the Plus offering, and 0.50% for the Premium offering. The Plus plan requires a $100k minimum balance, and the Premium plan requires a $250k minimum balance. For all three plans, Betterment’s fees are only charged on the first $2 million of your balance. Betterment will waive its management fee on any assets over $2 million.
“I joined Betterment because it was a chance to help get financial advice in the hands of more Americans- millions of Americans,” said Alex Benke, CFP, VP of Financial Advice and Investing at Betterment. “As a traditional financial planner, you can only serve a few hundred clients at most. Through the last five years at Betterment, I’ve learned that while most Americans really need financial advice, not everyone wants it in the same way. Some never want to talk to a person, some need help from time to time, and others need careful, ongoing guidance. About a year ago, we set out to broaden and deepen our human-delivered advice offering, while making it more accessible. Our vision is to be your one-stop-shop for financial advice, available in whatever form or frequency you require, and always in your best interest, as a fiduciary.”
“We’re committed to empowering customers to do what’s best for their money, so they can live better,” said Jon Stein, Founder and CEO of Betterment. “At Betterment, we promise to always act in the best interests of our customers. From the beginning, we’ve built what our customers have asked us to prioritize, and what would have the biggest impact for them. Now, with our Plus and Premium plans, we can give customers the best of both worlds: our smarter technology and access to licensed financial experts.”
The firm manages more than $7 billion in assets for more than 210,000 customers.
Mark Mobius, Foto cedida. Mark Mobius: "Somos optimistas, México se ve muy bien"
In his latest visit to Mexico, Mark Mobius, Executive Chairman Templeton Emerging Markets Group, discussed President Trump, the dollar, Emerging Markets, and why he believes Mexico is a good investment.
The man who wrote the book in emerging-market investing, that is celebrating his 30-year anniversary with Templeton Emerging Markets Group this month, says that above all, Donald Trump is a negotiator and as such, he is aware that in any deal both parties should benefit in order to considerate it a success, so is not worried about what will happen to Mexico with a Trump administration.
In his opinion, the US President is using twitter as a smokescreen and manipulating the media. Mobius says Trump is interested in having a bilateral relationship with Mexico, and other countries, but multilateral agreements like NAFTA will be pushed aside. “Trump was the only candidate to flew down to mexico” he recalls before pointing out that “higher economic growth in the US will be good for everybody, including Mexico… and once Americans feel economic security the anti-immigration sentiment will decrease.” Mobius also expects the dollar to devaluate in order to boost exports.
The EM specialist believes that the recovery in emerging markets will continue aided by cheap valuations – vs US, Japan and Europe, improving sentiment – since people are realizing they are underweight in EM, Technology and favorable demographics.
In Latin America he likes Brazil, Argentina and Mexico. Speaking of Mexico, Mobius said that the country looks great. According to him, the rising inflation is offset by faster rising wages “so the consumer is going to be spending -and maybe faster- as a result of inflation.” Meanwhile, he believes the peso, from a purchasing power perspective is 15-20% undervalued so, after another dip -mandated by market sentiment, it should appreciate.
“Mexico has been bombed out, the currency and the market have been hit and everybody expects the worst to come but the reality on the ground is quite different… The recovery could be very surprising to a lot of people. We expect a big jump in the Mexican market” He points out. The sectors Mobius and his team like in Mexico are consumption and those with regards to gold. They currently do not hold positions in any tech firms.
Another area of opportunity he identifies is the Energy sector. While in most countries Energy and Utilities represent an important part of the index, Mexico’s energy participation in the market is still incipient and Mobius expects the US and Mexico to work together in energy related sectors, like oil field equipment. “This could be very big.” He concludes.
According to a press release, EFAMA welcomes the FSB Policy Recommendations to Address Structural Vulnerabilities from Asset Management Activities on 12 January 2017, which come as the result of an extended consultation process in which EFAMA has participated very actively.
Peter De Proft, EFAMA Director General, commented: “EFAMA particularly welcomes the fact that the FSB recommendations reflect a more balanced view of the asset management industry, and acknowledge the risk mitigants already in place under the current EU regulatory framework and in market-based best practices. We also welcome the mandate given to IOSCO to lead the work in the identified fields and look forward to continue engaging with IOSCO in the months ahead”.
The document sets out 14 final policy recommendations to address four “alleged” structural vulnerabilities from asset management activities that could potentially present financial stability risks:
Liquidity mismatch between fund investments and redemption terms and conditions for open-ended fund units;
Leverage within investment funds;
Operational risks and challenges for asset managers in stressed conditions, particularly with regard to the transfer of client mandates;
Securities lending activities and related indemnification programmes offered by certain asset managers.
From a preliminary assessment, EFAMA believes that the final recommendations go in the right direction, in the sense that they do not identify a need for any substantial regulatory reviews of existing standards, and recommend that IOSCO develops additional and more detailed guidance to be carried out by end-2017 and end-2018.
Additionally, below are some general remarks on issues raised in the FSB Report.
Despite the fact that some of the speculative narrative around potential risks stemming from liquidity mismatches in open-end funds has been retained in the final report, we welcome that fact that several of the risk-mitigants highlighted by EFAMA in our responses have been acknowledged by the FSB in its final Report.
EFAMA views it as positive that the first nine liquidity management-related recommendations call on IOSCO to review/enhance its existing guidance by end-2017, as well as develop a set of harmonised data points for authorities to monitor the build-up to liquidity risks in funds.
Also positive is that certain recommendations introduce sufficient flexibility for national authorities to take action only “where appropriate” or “where relevant”, including the possible consideration of system-wide stress-testing judging on the relative systemic importance of actors in each jurisdiction and once better data become available;
Regarding leverage, EFAMA welcomes that the FSB recommendations on data on leverage in funds be aggregated and made consistent across the global jurisdictions. We support the work to be undertaken by IOSCO in collaboration with national authorities by the end of 2018.
As to operational risks, EFAMA believes that these remain overstated. In this regard, EFAMA stresses that the current EU regulatory framework as well as industry best practices largely already address the FSB’s concerns.
Finally, EFAMA believes that the potential risks with regard to securities lending as a potential source of systemic risks, via the indemnification of clients where asset managers are also agent-lenders, are overstated.
CC-BY-SA-2.0, FlickrRobert Wescott & Franceso Sandrini. Robert Wescott: “The Market is Not Evaluating the Risks Involved in Donald Trump's Policy”
Robert Wescott served as an advisor to President Bill Clinton in the late 1990s and for the last two decades has been a member of the Pioneer Investments Global Asset Allocation Committee. His long history analyzing the world economy does not preclude his surprise at the positive reaction of the markets after Donald Trump’s victory. Is it justified? During a lunch-conference with reporters in Madrid, Wescott pointed out that “the Dow Jones above 20,000 points reflects all the good news because the market expects Trump to make many economic decisions, but what are not being evaluated are the risks”.
And it is precisely the small companies that are most optimistic about the increase in spending that could further boost economic growth. “Companies’ high profits combined with more public spending are good news for the market,” said Francesco Sandrini, Head of Multi-Asset Solutions at Pioneer Investments. He says that in this sense we find ourselves in a period of transition from the so-called “secular stagnation”, “from fear of deflation to fear of inflation.”
But the risk, although not perceived yet, is there, and is mainly called China. And, according to Wescott, is not only because of the evolution of its economy, but also because of the political tensions generated by Taiwan’s diplomatic recognition. Trump’s words during his recent interview with The Wall Street Journal in which he admitted that “everything is in negotiation” are as explosive as a lit wick near a barrel of oil.
But the nature of the new president’s relationship with Russia is also a source of uncertainty. It could even be the trigger for a process of “impeachment” if it were demonstrated that “secret connections” exist. Wescott acknowledges that during his lectures in Europe, “everyone has asked me about the possibility of this process being initiated against Trump.” But the truth is that the new president, ” surrounds himself only with people who always agree with him and who flatter him “
“The Mexican wall is a symbol, there are many ways to cross that border”
Trump, who since the election campaign, has been firmly anchored in transmitting the message that everything is terrible, and identifying immigrants as terrorists “who have come to kill our women,” has as his main objective to keep America safe. However, as Wescott admits, the wall he wants to build between the US and Mexico, has been in operation since the mid-1990s when, to be precise, the Clinton administration, for which he was an advisor, authorized its construction in small areas of the border, such as San Diego or El Paso. “The wall is only symbolic, there are many ways to cross that border, but the wall symbolizes that the US does not want immigrants,” he says.
Another point of friction will be with the Republican Party itself. According to Wescott, “Republicans want little regulation, low taxes, and little spending. Trump agrees on everything except spending, and this is what can create tension.” Expenditure which will be focused on infrastructures and that will seek the support of the private sector. “Everybody looks at the big infrastructures, but there are many other microprojects that can be put in place,” says Sandrini.
On the continuity of Janet Yellen at the helm of the Fed, Wescott is very clear: “The chances of Trump holding on to Yellen are zero” and he points to Jack Welles as a possible candidate, despite his advanced age. In his final message, the expert points out what, in his view, is an “imperative for the future, we need economic growth.”
CC-BY-SA-2.0, FlickrPhoto: olnetchannel
. The Future of Monetary Policy – Normalization or New Norms?
In its new report “The Future of Monetary Policy”, the Credit Suisse Research Institute looks at the transformative changes central banks in advanced economies have undergone since 2008. The report concludes that the key issue for decision-makers globally remains to consider which fundamental direction monetary policy ought to take next, assessing two alternative scenarios that may evolve: a return to a pre-crisis “normal”, or an extension or amplification of recent policy trends, leading to a further blurring of boundaries between monetary, regulatory and fiscal mandates.
In response to the extraordinarily challenging environment in the immediate aftermath of the global financial crisis of 2008, central banks in leading advanced economies have seen their mandates broadened from fairly narrowly defined macroeconomic targets, such as price stability and employment, to include financial stability.
Moreover, to achieve their targets, central banks have adopted an ever-broader range of previously untested “unconventional” policy tools, including quantitative easing and negative interest rates. As a result, central banks have become prominent providers of assets and liquidity for sovereigns, financial institutions and shadow banks, reflected also in a manifold expansion of their balance sheets.
Oliver Adler, Head of Economic Research International Wealth Management, Credit Suisse: “Since 2008, central banks have changed their policy-making in dramatic ways, initially to prevent a major destabilization of the financial system in the immediate aftermath of the financial crisis, and thereafter to offset evolving deflation risks. The coming years will be decisive in relation to the future direction of central bank policy, depending on both economic and political developments. Even if the influencing factors are difficult to predict, we believe that the discussion of the future of monetary policy needs to be reinforced.”
CC-BY-SA-2.0, FlickrPhoto: Buvette. More than 25,000 Investment Professionals Worldwide Pass the Level I CFA Exam
CFA Institute, the global association of investment management professionals, reports that 43 percent of the 59,627 candidates that took the Chartered Financial Analyst (CFA) Level I exam in December 2016 have passed. These successful candidates now progress to Level II of the CFA Program, charting a course to build an investment profession dedicated to professional excellence. The December 2016 exam saw continued growth with an increase of 14 percent from the previous year in the number of Level I candidates tested for the CFA Program, a globally recognized, graduate level curriculum that links theory and practice with real-world investment analysis, and emphasizes the highest ethical standards.
“CFA Institute is dedicated to shaping a trustworthy investment management profession, and the CFA Program prepares candidates from around the world to have the highest level of professional knowledge within the industry to better serve investors and society at large,” said Paul Smith, CFA, president and CEO of CFA Institute. “Congratulations to this next generation of investment professionals, who have already displayed a commitment to raising standards in the industry, and are one step closer to becoming CFA charterholders.”
To earn the CFA charter, candidates must pass all three levels of exam (successful candidates often report dedicating in excess of 300 hours of study per level); meet the work experience requirements of four years in the investment industry; sign a commitment to abide by the CFA Institute Code of Ethics and Standards of Professional Conduct; apply to a CFA Institute society; and become a member of CFA Institute.
The CFA Program curriculum develops knowledge and competencies that investment professionals deem necessary in today’s ever changing marketplace. It covers ethical and professional standards, securities analysis and valuation, international financial statement analysis, quantitative methods, economics, corporate finance, portfolio management, wealth management and portfolio analysis. Level I exams are offered in both June and December and Levels II and III are offered only in June. It takes most candidates more than three years to complete the CFA Program, and requires dedication and determination.
The December 2016 Level I exam was administered in 104 test centers in 72 cities across 40 countries worldwide. Examples of countries and territories with the largest number of candidates that took the Level I CFA exam last December are Mainland China (14,181), the United States (12,187), India (6,357), Canada (4,210), United Kingdom (3,790), Hong Kong (2,210), Singapore (1,577), South Africa (1,327), and United Arab Emirates (1,207).
Foto: Ludovic Bertron
. Franklin Templeton lanza el primer ETF de renta variable internacional gestionado activamente en LibertyShares
Franklin Templeton Investments has introduced a new actively managed international equity ETF to its Franklin LibertyShares platform. Franklin Liberty International Opportunities ETF (FLIO) provides investors with broad and diversified access to international equity markets outside the U.S., spanning developed, developing and frontier markets, and across sectors and market capitalizations. FLIO is being listed on NYSE Arca on January 27, 2017.
“The launch of Franklin Liberty International Opportunities ETF marks our first actively managed international ETF and continuing expansion of our LibertyShares offerings,” said Patrick O’Connor, the firm´s Global Head of ETFs. “With over 75 percent of the world’s GDP coming from countries outside the U.S., investing internationally can provide portfolio diversification, which can reduce overall risk. As we believe successful international investing can benefit from combining a global investment perspective with local presence and insights, we are leveraging fundamental research from our local asset management and emerging markets teams around the world in managing this new ETF.”
The ETF is co-managed by Stephen Dover, CFA, CIO for Franklin Templeton Local Asset Management and Templeton Emerging Markets Group, and Purav Jhaveri, CFA, managing director of investment strategy for the Local Asset Management group. They draw upon the research and perspectives of over 80 investment professionals comprising the firm’s 14 local asset management teams globally, who provide on-the-ground insights on local market conditions, dynamics and valuations and timely perspective on market events, risks and opportunities. The fund’s managers also leverage the expertise of Templeton Emerging Markets Group’s more than 50 investment professionals for further insight into emerging countries, an area of the market that they believe is critical to international equity portfolios, given its importance to future growth potential.
In constructing a diversified portfolio of companies, the fund’s managers focus on key attributes that foster their high conviction, including:
Focus on quality
Superior earnings growth
Low financial leverage
Strong management track record
Franklin LibertyShares’ actively managed ETFs strive to outperform their benchmarks. Portfolio managers have the flexibility to respond, with discretion, to market events and operate outside the confines of traditional benchmark indices.
“Investors who have embraced the ETF wrapper for its benefits—which may include liquidity, tax efficiency and transparency—want the opportunity to seek better risk-adjusted returns over the long term,” said David Mann, Head of Capital Markets, Global ETFs. “Franklin LibertyShares provides investors with simple and efficient options to help them address their desired outcomes. Our actively managed ETFs, which now include Franklin Liberty International Opportunities ETF, can help investors meet their investment needs by serving as a core or complementary portfolio holding.”
Franklin LibertyShares has more than $545 million in assets under management as of January 24, 2017.
State Street Corporation has announced that John Plansky will be named global head of State Street Global Exchange. In this role, Plansky will be responsible for global strategy, new product development and developing solutions for clients that help them manage increasingly complex data, search for better performance, focus on attracting assets and meet heightened risk challenges.
Plansky will report to Executive Vice President Lou Maiuri.
Plansky joins from PricewaterhouseCoopers (PwC) where he led the US Strategy business and US Global Platforms business and was a member of the Advisory Financial Services Leadership team. Prior to the acquisition of Booz & Co. by PwC, Plansky was a senior partner at Booz & Co. leading the Technology practice and serving as a senior advisor to global financial institutions such as State Street. Prior to joining Booz & Co., he was CEO of NerveWire and led its sale to Wipro where he subsequently led their global capital markets business. John has a degree in Biophysics, BS from Brown University.
“John has partnered with State Street in various roles over the past 16 years,” said Maiuri. “He has seen our evolution first hand and brings significant experience leading global teams, growing revenue, and integrating dozens of capabilities and skill sets to produce better client outcomes. As we continue to digitize our company, John will help State Street and our clients meet the data challenge.”
Pixabay CC0 Public DomainFoto: sasint. Harvard University's Endowment to Lay Off Over 100 People
Harvard Management Company (HMC), in charge of Harvard University’s endowment and related financial assets since 1974, announced on Wednesday the addition of Rick Slocum as chief investment officer, effective in March 2017, and three managing directors to its investment team. Each will report to chief executive officer N.P. Narvekar, who was appointed president and chief executive officer of HMC back in September and assumed his role on December 5, 2016.
“I am pleased to welcome four senior investors to HMC who bring substantial investment expertise and deep insight into building and working in a generalist investment model and partnership culture. I have known these individuals both personally and professionally for the majority of my career and I value their insights and perspectives,” said Narvekar. “I am confident they will be a great addition to the talented and experienced investment team here at HMC.”
The new hires will play a key role in helping HMC transition from an asset class-specialization approach to a generalist investment model and help support a strategy of further deepening HMC’s relationships with a select group of external managers, which will translate into an overhaul of HMC that could include the lay off of roughly half of their 230 employees.
Harvard University’s endowment is the largest academic endowment in the world.
CC-BY-SA-2.0, FlickrFoto: frankieleon
. Financière de la Cité Launched a Brexit Themed Fund
French boutique Financière de la Cité has launched the FDC Brexit fund, with the aim of benefiting from the new market environment created by the imminent departure of the United Kingdom from the European Union.
The fund managed by Bruno Demontrond, which was launched on December 30th, 2016 and invests primarily in British, Swiss and Scandinavian stocks, is quoted in euros and aims to outperform the Euro Stoxx 600 index for at least the next five years. BNP Paribas acts as custodian.
The management team believes that the devaluation of the pound will facilitate a rebalancing in the UK economy that will offer new flexibility to Britain, at a time when the euro zone economy is vulnerable to deflationary policies, as well as disagreements over the management of the single currency. FDC Brexit intends to take advantage of this environment with a selection of industrial companies essentially focused on the United Kingdom and Switzerland, European countries in which economic policy and monetary policy are in the same hands.
According to Financière de la Cité, FDC Brexit will offer, in addition to exposure to Europe, through a diversified portfolio of solid companies, a theme of renationalisation of economies and trade, as well as ordinary dividends in popular currencies.