Unlocking Real Value Blog

Poll: Fund Industry Confident in Its Post-Crisis Strategy

Published in Ignites – An Information Service of Money-Media, a Financial Times Company
By Greg Shulas

Fund industry professionals overwhelmingly believe their firms are well positioned to deliver product and services that satisfy investors’ post-financial crisis needs. That’s according to a majority of Ignites poll respondents.

Roughly 73%, or 177 voters, said their firms are well situated for the retail investing environment that’s been shaped by the economic downturn. That made it the topsentiment expressed in the Ignites survey on how well prepared fund professionals believe their firms are for a more challenging business environment.

Of the majority, 41%, or 99 voters, said their firms are well positioned for the post-crisis landscape, while 32%, or 78 voters, said their companies are very well positioned.

Meanwhile, a mere 11%, or 25 voters, said their investment companies are at acompetitive disadvantage, making that the poll’s least popular option.

Approximately 16%, or 39 voters, gave their firm mixed reviews, saying that the investment company’s preparedness is no better or worse than their peers.

The survey’s findings differ from a recent KPMG study of global investment executives in which 65% said their company’s top management lacked vision and posed a major obstacle to change during the financial recovery.

Further, 90% of U.S. respondents polled had no confidence in their firms’ upper management. The KPMG study’s respondents included investment managers and institutional investors, such as insurance companies, pension funds and sovereign wealth funds. The retail investors it surveyed included wealth managers and family offices, the latter being an advisor group which mainly serves sophisticated high-net-worth investors.

In contrast, the Ignites poll reveals a mutual fund industry that’s largely united in its postcrisis strategy.

Ignites has reported how fund companies have responded to market turmoil by developing new products and strategies that complement the needs of a more skeptical and conservative investor base.

Investment companies have explored developing retirement income funds that seek to provide steady income and relative stability through a form of guarantee, as well as funds that are less correlated to the equity and fixed-income markets.

Investment companies also have been tailoring their wholesaler and customer support services to address investors’ and end-clients’ concerns about investment losses and future financial planning

Andy Klausner, founder of AK Advisory Partners, a strategic consultancy serving the wealth management industry, says mutual fund companies are wise to distinguish themselves as providers of best-of-breed client servicing ideas to advisors.

“These ideas should not only include talking points on the performance of their particular funds, but more importantly general servicing ideas that will help them with their entire book of business, as this will help build advisor loyalty to them,” Klausner says.

Precisely 241 Ignites subscribers participated in the survey as of 3 p.m. Tuesday.

The poll is an unscientific sampling of Ignites’s audience. Readers voted only once on a voluntary basis. Ignites’s audience consists of money managers, service providers and financial advisors.

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