Investment advisors are often minimalist when it comes to marketing, typically spending 2% to 4% of their budget on promotional activities. But while business leaders rely on client referrals to grow their business, some consultants are getting more creative in planning and promoting events after two and a half years of Covid. The effort is to offer "experiences" to customers, such as bourbon tastings or lessons from renowned chefs.
In another of the most read articles of the week on wealth management:
A couple of consultants went to Wells. At Wells Fargo, a few successful advisors have edged out corporate competitors in recent years, but Wirehouse just won a two-man team that manages $580 million in assets for JPMorgan Chase's asset management division. Scott Seltzer and Christopher Defelis bring in a list of the high-value clients they serve from their New York and Palm Beach, Florida offices.
Agreement terminated. UBS has now abandoned its planned $1.4 billion acquisition of robo-adviser Wealthfront. Wirehouse said it remains committed to building its digital offering, but the failure of the deal has left observers wondering what the next steps will be. UBS has struggled with robotic counseling in the past, especially with the closure of SmartWealth. Meanwhile, Wealthfront remains the only leading independent digital consultant in the US.
Growth of one stock ETF. Stock firm Direxion has expanded its range of single stock ETFs, an increasingly popular tactic for gaining mass exposure to single stocks. These high-growth funds offer income and opportunities for short-term betting on the rise or fall of certain stocks. The six new Direxion funds are offering positions at Amazon, Google's parent company, Alphabet and Microsoft, following the trend of large-cap equity ETFs. However, single stock ETFs linked to smaller and more inventive companies like GameStop and AMC may soon follow suit.
Communication Whether you like it or not, young Gen Z and Gen Alpha people are increasingly relying on professional online services for research, news gathering and, of course, financial advice. Our columnist says that successful companies must interact with customers on social platforms. It offers a five-point plan to optimize your digital messaging, build trust, and humanize your brand.
Advisory Bulletin
ConversationTake time Friday night to delve into the thoughts of our top consultants and industry leaders in our weekly Q&A. Plus a weekly roundup of key asset management news.
More collaboration issues. The Securities and Exchange Commission has taken enforcement action against other registered investment advisors for overburdening clients for certain classes of mutual funds when cheaper offerings of the same funds are available. In the latest action by the SEC in its longstanding fight against stock class abuse, Aventura Capital Management has agreed to pay nearly $1 million to settle allegations of mutual fund and money market overpricing.
During the boom in the RIA industry, many companies reactively invested in new talent or capabilities, only to find they lacked bandwidth. During this week's Barron Advisors Q&A session, Leo Kelly, CEO of Verdence Capital Advisors, explains how he took the opposite approach, ramping up power ahead of growth. It also discusses why the company is ending Hightower training and identifies industry dynamics that may make it difficult to add new consultants.
Good weekend.
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