BlackRock CEO says sustainability is the ‘top issue’ for investors—here’s what that means for your money

BlackRock, the world’s largest investment firm, will put sustainability at the center of its investment strategy going forward, according to CEO Larry Fink’s annual letter to chief executives. Larry Fink CEO, BlackRock”Our investment conviction is that sustainability- and climate-integrated portfolios can provide better risk-adjusted returns to investors,” Fink writes. To Fink, that means that company is not a wise investment and does not belong in clients’ portfolios. These products aren’t yet


BlackRock, the world’s largest investment firm, will put sustainability at the center of its investment strategy going forward, according to CEO Larry Fink’s annual letter to chief executives.
Larry Fink CEO, BlackRock”Our investment conviction is that sustainability- and climate-integrated portfolios can provide better risk-adjusted returns to investors,” Fink writes.
To Fink, that means that company is not a wise investment and does not belong in clients’ portfolios.
These products aren’t yet
BlackRock CEO says sustainability is the ‘top issue’ for investors—here’s what that means for your money Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-01-14  Authors: alicia adamczyk
Keywords: news, cnbc, companies, investorsheres, issue, sustainable, clients, investment, ceo, portfolios, blackrock, funds, sustainability, investing, money, companies, means, investors


BlackRock CEO says sustainability is the 'top issue' for investors—here's what that means for your money

BlackRock, the world’s largest investment firm, will put sustainability at the center of its investment strategy going forward, according to CEO Larry Fink’s annual letter to chief executives. The letter, first reported by the New York Times, states that BlackRock, which manages almost $7 trillion in assets, will immediately stop investing in companies that “present a high sustainability-related risk,” such as coal producers. It will also introduce new products that screen for fossil fuel producers and make sustainability “integral to portfolio construction and risk management.” Climate change, Fink writes, is “almost invariably the top issue that clients around the world raise” when wondering how to make their investments more sustainable. The numbers bear it out: Investors in the U.S. contributed a record $20.6 billion to sustainable funds last year, according to a new report from Morningstar, nearly four times as much as they contributed in 2018. Investors, particularly younger generations that are beginning to accumulate more wealth, are particularly interested in socially-responsible investing, Adam Grealish, director of investing at Betterment, tells CNBC Make It. Noting that BlackRock is a fiduciary that invests money on behalf of others, Fink writes that climate change is a major economic issue, affecting housing prices, insurance markets, productivity, food costs and more. Being more sustainable, then, isn’t just a political choice — it’s the smartest business decision, he says.

We believe that sustainable investing is the strongest foundation for client portfolios going forward. Larry Fink CEO, BlackRock

“Our investment conviction is that sustainability- and climate-integrated portfolios can provide better risk-adjusted returns to investors,” Fink writes. “And with the impact of sustainability on investment returns increasing, we believe that sustainable investing is the strongest foundation for client portfolios going forward.” Any executive who does not take climate change seriously, he writes, is harming the long-term prospects of their company. To Fink, that means that company is not a wise investment and does not belong in clients’ portfolios. Still, as Bloomberg noted, BlackRock is one of the largest investors in fossil fuel companies, given how many assets it holds. And although it will stop investing in companies that get more than 25% of sales from coal, BlackRock will continue to invest in many of the biggest coal producers, which have diversified income streams. The asset manager had come under increasing criticism for being slow to address climate issues. A 2019 analysis of shareholder votes on climate change resolutions showed that BlackRock and Vanguard had the worst voting records in the fund industry.

What this means for you

Fink’s letter is an important step forward for the sustainability movement, and could influence other financial firms to follow suit. But it doesn’t mean that companies will lose all of their investments overnight if they are not sustainable enough. About two-thirds of investor money is held in passively managed index funds. BlackRock can’t simply divest from companies in the index. Instead, it can tweak its actively managed products. In a letter to clients that echoes Fink’s message to CEOs, BlackRock says it will make sustainable funds the “standard building blocks” of clients’ portfolios whenever possible, and plans to offer sustainable versions of its target-date funds and build a sustainable index fund. BlackRock’s proposed sustainable target-date fund is particularly exciting because it would mean investors could select a single, low-cost fund for their retirement portfolios without the need to rebalance it themselves. It could also influence other financial firms to create their own sustainable index funds and target-date funds. These products aren’t yet available, but there are plenty of sustainable funds currently offered by financial firms, including a handful of target-date funds. BlackRock also wants the companies it invests clients’ money in to make certain financial disclosures related to sustainability, including disclosing “climate-related risks.” If they don’t, BlackRock will vote against the management teams in place. That’s no empty threat. The asset manager holds considerable sway in corporate America: BlackRock, State Street Corp. and Vanguard Group hold around a fifth of the S&P 500 via their clients’ investments. In the past, the companies have more or less voted in line with management; now, BlackRock says it will use its voting power to push sustainability measures, which could encourage companies to be more transparent and put some sustainability measures into place.


Company: cnbc, Activity: cnbc, Date: 2020-01-14  Authors: alicia adamczyk
Keywords: news, cnbc, companies, investorsheres, issue, sustainable, clients, investment, ceo, portfolios, blackrock, funds, sustainability, investing, money, companies, means, investors


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Goldman Sachs is telling wealthy clients stock returns will be much less this year

Brendan McDermid | ReutersGoldman Sachs is telling its wealthy clients not to expect 2019’s blowout returns again this year. “Strong erstwhile returns have borrowed from future gains,” Sharmin Mossavar-Rahmani, Goldman Sachs Investment Strategy Group CIO, said in the group’s 2020 outlook. Goldman’s base case estimates the S&P 500 will return 6% in 2020, with a 55% probability. The S&P 500 returned a whopping 30% in 2019, helped by the Federal Reserve’s three rate cuts to spur economic growth. Th


Brendan McDermid | ReutersGoldman Sachs is telling its wealthy clients not to expect 2019’s blowout returns again this year.
“Strong erstwhile returns have borrowed from future gains,” Sharmin Mossavar-Rahmani, Goldman Sachs Investment Strategy Group CIO, said in the group’s 2020 outlook.
Goldman’s base case estimates the S&P 500 will return 6% in 2020, with a 55% probability.
The S&P 500 returned a whopping 30% in 2019, helped by the Federal Reserve’s three rate cuts to spur economic growth.
Th
Goldman Sachs is telling wealthy clients stock returns will be much less this year Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-01-10  Authors: maggie fitzgerald
Keywords: news, cnbc, companies, returns, sachs, telling, return, clients, wealthy, 500, returned, stock, average, goldman, 2020


Goldman Sachs is telling wealthy clients stock returns will be much less this year

Traders work on the floor at the New York Stock Exchange. Brendan McDermid | Reuters

Goldman Sachs is telling its wealthy clients not to expect 2019’s blowout returns again this year. The firm’s private bank, which manages about $1.5 trillion in assets, estimates U.S. equities will gain about 6% in 2020, a modest return after 2019’s near 30% rally. “Strong erstwhile returns have borrowed from future gains,” Sharmin Mossavar-Rahmani, Goldman Sachs Investment Strategy Group CIO, said in the group’s 2020 outlook. Goldman’s base case estimates the S&P 500 will return 6% in 2020, with a 55% probability. In its good case, the index will return 12%, with a 25% probability.

The S&P 500 returned a whopping 30% in 2019, helped by the Federal Reserve’s three rate cuts to spur economic growth. Plus, a “phase one” trade deal between the U.S. and China and lower risks of a disorderly Brexit boosted investor sentiment. Alongside equities, corporate bonds, government bonds and commodities such as gold and oil all advanced last year. “The magnitude of this gain was second only to its persistence,” Goldman’s note said, adding that the S&P 500 rose on nearly 60% of last year’s trading days.

Stay invested

While Goldman anticipates modest gains this year, it is still recommending clients keep their money in the market. “Given our view of a low probability of recession … the economic and policy backdrop favors staying invested,’ said Mossavar-Rahmani. Historically, when the S&P 500 has returned 30% on a rolling 12-month basis — as it did in 2019 — the next year’s returns average 10.4%, with a positive price return 85% of the time. This average is higher than the average yearly return of the market in the post-WWII period, Goldman notes.


Company: cnbc, Activity: cnbc, Date: 2020-01-10  Authors: maggie fitzgerald
Keywords: news, cnbc, companies, returns, sachs, telling, return, clients, wealthy, 500, returned, stock, average, goldman, 2020


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Investor flows show there’s no euphoria for this bull market, which means it could keep going

A trader works on the floor at the closing bell of the New York Stock Exchange, December 30, 2019. This suggests the bull market may still have some room to run. Investment flow data shows that individual investors were largely net sellers of equities in 2019, even as corporate buybacks helped push the market to record highs. The lack of widespread participation suggests that the market hasn’t hit a moment of euphoria or “blow-off top” that often precedes a pullback. The same data showed that th


A trader works on the floor at the closing bell of the New York Stock Exchange, December 30, 2019.
This suggests the bull market may still have some room to run.
Investment flow data shows that individual investors were largely net sellers of equities in 2019, even as corporate buybacks helped push the market to record highs.
The lack of widespread participation suggests that the market hasn’t hit a moment of euphoria or “blow-off top” that often precedes a pullback.
The same data showed that th
Investor flows show there’s no euphoria for this bull market, which means it could keep going Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-01-09  Authors: jesse pound
Keywords: news, cnbc, companies, highs, showed, theres, market, investor, means, flows, data, suggests, euphoria, clients, investors, going, wars, stock, bull, net


Investor flows show there's no euphoria for this bull market, which means it could keep going

A trader works on the floor at the closing bell of the New York Stock Exchange, December 30, 2019.

The stock market’s indomitable run to continued record highs despite fears about trade wars, real wars and a recession still has not been enough to lure most investors off the sidelines and into stocks.

This suggests the bull market may still have some room to run.

Investment flow data shows that individual investors were largely net sellers of equities in 2019, even as corporate buybacks helped push the market to record highs. The lack of widespread participation suggests that the market hasn’t hit a moment of euphoria or “blow-off top” that often precedes a pullback. That will only happen when these investors finally capitulate and flow back into stocks on fear of missing out on more gains.

With the market “trading at fresh all-time highs, the investor participation has been light, and the bear capitulation is likely to have legs,” J.P. Morgan strategists said in a note to clients Monday.

There appears to be no change in that pattern as the calendar turned to 2020. Data from Bank of America Securities showed a $550 million net outflow for the bank’s clients during the first week of the year. The same data showed that the clients were net buyers of equities in 2019, but that was driven almost entirely by corporate buybacks. Individual investors were the biggest net sellers.


Company: cnbc, Activity: cnbc, Date: 2020-01-09  Authors: jesse pound
Keywords: news, cnbc, companies, highs, showed, theres, market, investor, means, flows, data, suggests, euphoria, clients, investors, going, wars, stock, bull, net


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Massachusetts is considering its own investor protection rule. Brokerage and insurance groups oppose it

The Securities and Exchange Commission’s new rule, called Regulation Best Interest, went into effect in September of last year. As its name implies, Regulation Best Interest — “Reg BI,” for short — requires brokers to keep their clients’ best interests in mind when recommending securities. But the SEC rule was met with critics, including William Galvin, Massachusetts secretary of the commonwealth, who said that Reg BI did not go far enough. Instead, Galvin said a uniform fiduciary rule, which wo


The Securities and Exchange Commission’s new rule, called Regulation Best Interest, went into effect in September of last year.
As its name implies, Regulation Best Interest — “Reg BI,” for short — requires brokers to keep their clients’ best interests in mind when recommending securities.
But the SEC rule was met with critics, including William Galvin, Massachusetts secretary of the commonwealth, who said that Reg BI did not go far enough.
Instead, Galvin said a uniform fiduciary rule, which wo
Massachusetts is considering its own investor protection rule. Brokerage and insurance groups oppose it Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-01-08  Authors: lorie konish
Keywords: news, cnbc, companies, massachusetts, sec, rule, galvin, oppose, considering, protection, brokerage, regulation, clients, uniform, best, investor, groups, insurance, called, standard, fiduciary


Massachusetts is considering its own investor protection rule. Brokerage and insurance groups oppose it

A new federal regulation aimed at providing increased investor protection isn’t slated to go into effect until later this year.

But a fight is already brewing in one state — Massachusetts — over the potential enforcement of a stronger rule.

The Securities and Exchange Commission’s new rule, called Regulation Best Interest, went into effect in September of last year. But firms have until June 30 of this year to comply with the rule.

As its name implies, Regulation Best Interest — “Reg BI,” for short — requires brokers to keep their clients’ best interests in mind when recommending securities. It also requires additional disclosures outlining the terms of the relationship be presented to clients.

But the SEC rule was met with critics, including William Galvin, Massachusetts secretary of the commonwealth, who said that Reg BI did not go far enough.

In an August 2018 letter to the SEC, Galvin said the best-interest standard “will foster confusion and will fail to protect vulnerable investors.”

Instead, Galvin said a uniform fiduciary rule, which would require both broker-dealers and investment advisors to put clients’ interests first, would be preferable. Currently, broker-dealers answer to what is called a “suitability rule.” That means their recommendations must be suitable for clients. Investment advisors, on the other hand, are already held to a fiduciary standard.

The SEC has the authorization to come up with a uniform fiduciary standard under a 2010 law called the Dodd-Frank Wall Street Reform and Consumer Protection Act.


Company: cnbc, Activity: cnbc, Date: 2020-01-08  Authors: lorie konish
Keywords: news, cnbc, companies, massachusetts, sec, rule, galvin, oppose, considering, protection, brokerage, regulation, clients, uniform, best, investor, groups, insurance, called, standard, fiduciary


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More Bank of America clients bought single stocks than ETFs for the first time in 11 years

U.S. stocks sank, erasing yesterday’s rally, amid losses in industrial metals and disappointing results from Bank of America Corp.By one measure, the shift to passive investing from active is slowing down. With just one week left in 2019, Bank of America said Tuesday its clients have bought more stocks in individual companies this year than exchange-traded funds for the first time since 2008. The bank’s data showed its clients bought about $38 billion worth of single stocks in 2019, exceeding th


U.S. stocks sank, erasing yesterday’s rally, amid losses in industrial metals and disappointing results from Bank of America Corp.By one measure, the shift to passive investing from active is slowing down.
With just one week left in 2019, Bank of America said Tuesday its clients have bought more stocks in individual companies this year than exchange-traded funds for the first time since 2008.
The bank’s data showed its clients bought about $38 billion worth of single stocks in 2019, exceeding th
More Bank of America clients bought single stocks than ETFs for the first time in 11 years Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-24  Authors: yun li
Keywords: news, cnbc, companies, america, york, trillion, etfs, worth, stocks, passive, bought, clients, market, individual, single, bank


More Bank of America clients bought single stocks than ETFs for the first time in 11 years

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Wednesday, April 17, 2013. U.S. stocks sank, erasing yesterday’s rally, amid losses in industrial metals and disappointing results from Bank of America Corp.

By one measure, the shift to passive investing from active is slowing down.

With just one week left in 2019, Bank of America said Tuesday its clients have bought more stocks in individual companies this year than exchange-traded funds for the first time since 2008.

The bank’s data showed its clients bought about $38 billion worth of single stocks in 2019, exceeding the $25 billion worth of ETFs they purchased. From 2008 to 2017, Bank of America’s clients consistently sold individual stocks and piled into passive vehicles.

While data from just one shop might not be representative of the whole industry, it could be a sign that some investors are seeking more protection and active management as the record-long bull market headed to its 11th year.

Active strategies have suffered for more than a decade as inexpensive investments have enjoyed a boom in the current economic expansion. Since the inception of the first ETF — the S&P 500 SPDR — in 1993, the U.S. market has grown rapidly to a $4.3 trillion juggernaut, according to Morningstar.

Bank of America previously predicted that the assets in the ETF market could surge tenfold to $50 trillion by 2030.


Company: cnbc, Activity: cnbc, Date: 2019-12-24  Authors: yun li
Keywords: news, cnbc, companies, america, york, trillion, etfs, worth, stocks, passive, bought, clients, market, individual, single, bank


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Goldman sees one of its portfolios for clients tripling the return of the market next year

But for investors looking for ways to beat the market, Goldman Sachs has a portfolio that it expects to triple the market’s return in 2020. The bank is recommending clients stocks with high Sharpe ratios, a measure of a stock’s performance relative to its volatility. The portfolio has a track record of beating the market, Goldman said. It has outpaced the S&P 500’s return by 5.7 percentage points on average during the last 20 years, and it outperformed the market by 4 percentage points this year


But for investors looking for ways to beat the market, Goldman Sachs has a portfolio that it expects to triple the market’s return in 2020.
The bank is recommending clients stocks with high Sharpe ratios, a measure of a stock’s performance relative to its volatility.
The portfolio has a track record of beating the market, Goldman said.
It has outpaced the S&P 500’s return by 5.7 percentage points on average during the last 20 years, and it outperformed the market by 4 percentage points this year
Goldman sees one of its portfolios for clients tripling the return of the market next year Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-23  Authors: yun li
Keywords: news, cnbc, companies, stocks, market, percentage, return, sharpe, price, clients, portfolios, tripling, sees, goldman, high, ratio


Goldman sees one of its portfolios for clients tripling the return of the market next year

After a record-breaking 2019, Wall Street generally expects much more modest gains for stocks next year. But for investors looking for ways to beat the market, Goldman Sachs has a portfolio that it expects to triple the market’s return in 2020.

The bank is recommending clients stocks with high Sharpe ratios, a measure of a stock’s performance relative to its volatility. Stocks in its 50-name high Sharpe ratio basket are forecast by the firm’s analysts to generate a median 17% return over the next 12 months, about three times the firm’s S&P 500 forecast of 6%.

“Our high Sharpe Ratio basket typically has a value tilt and often contains some constituents that have experienced substantial price declines and have high upside to consensus price targets,” David Kostin, Goldman’s chief U.S. equity strategist, said in a note on Friday.

Goldman uses consensus 12-month price targets and options six-month implied volatility to measure Sharpe ratios. The portfolio has a track record of beating the market, Goldman said. It has outpaced the S&P 500’s return by 5.7 percentage points on average during the last 20 years, and it outperformed the market by 4 percentage points this year, returning 32%.

The S&P 500 is up more than 28% this year, about 1 percentage point away from 2013′s gain of 29.6%. The easing trade tensions between the U.S. and China and receding recession fears have led to a rush into equities at the year-end. For 2020, Wall Street analysts are mostly seeing smaller gains with an average target of 3,330, which represents a gain of about 4% from here, according to the CNBC Market Strategist Survey.

Energy and real estate sectors will deliver the most upside next year — 21% and 9% returns respectively — after their underperformance in 2019, Goldman said. Stocks in Goldman’s high Sharpe ratio basket include Netflix, T-Mobile, Coca-Cola, Citigroup, Visa and VeriSign.


Company: cnbc, Activity: cnbc, Date: 2019-12-23  Authors: yun li
Keywords: news, cnbc, companies, stocks, market, percentage, return, sharpe, price, clients, portfolios, tripling, sees, goldman, high, ratio


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Rogue Bank of England supplier gave clients head start on briefings

The Bank of England (BOE) has admitted that a rogue supplier has been misusing feeds from its press briefings since earlier this year, giving high-speed traders access to potentially market-moving information seconds before rivals. The supplier had been sending the feed to high-speed traders who could have had a five to eight second head start as audio can be transmitted far faster than video, The Times said. The rogue supplier also offers high-speed audio services for news conferences hosted by


The Bank of England (BOE) has admitted that a rogue supplier has been misusing feeds from its press briefings since earlier this year, giving high-speed traders access to potentially market-moving information seconds before rivals.
The supplier had been sending the feed to high-speed traders who could have had a five to eight second head start as audio can be transmitted far faster than video, The Times said.
The rogue supplier also offers high-speed audio services for news conferences hosted by
Rogue Bank of England supplier gave clients head start on briefings Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-19
Keywords: news, cnbc, companies, clients, traders, newspaper, gave, highspeed, rogue, audio, start, england, boe, bank, supplier, feed, central, conferences, briefings, head


Rogue Bank of England supplier gave clients head start on briefings

Mark Carney, Bank of England Governor, in an interview in Washington, D.C. on October 13, 2017.

The Bank of England (BOE) has admitted that a rogue supplier has been misusing feeds from its press briefings since earlier this year, giving high-speed traders access to potentially market-moving information seconds before rivals.

Following a report in The Times newspaper, Britain’s central bank said on Wednesday that a third-party supplier had accessed a back-up audio feed of some of its news conferences without its consent and supplied it to “other external clients”.

Briefings by BOE Governor Mark Carney and other central bank officials often move the prices of assets such as sterling and British government bonds, and early access to them could potentially allow traders to make millions.

The supplier had been sending the feed to high-speed traders who could have had a five to eight second head start as audio can be transmitted far faster than video, The Times said.

The rogue supplier also offers high-speed audio services for news conferences hosted by the European Central Bank, the U.S. Federal Reserve and the Bank of Canada, the newspaper said.

“This wholly unacceptable use of the audio feed was without the Bank’s knowledge or consent, and is being investigated further,” the central bank said in a statement, without naming the supplier.

Carney is due to leave the central bank within weeks and his replacement is expected to be announced soon following last week’s parliamentary election. The bank is due to make a policy announcement at midday (1200 GMT) on Thursday.

The audio feed was intended as a fallback option if the central bank’s official video feed of its news conferences failed, according to The Times.

A BOE spokesman said it had referred the misuse of the feed to the Financial Conduct Authority (FCA).

The bank said it had blocked the supplier’s access once the newspaper had informed it of the misuse. It said the supplier had not distributed feeds from its most recent news conference and will not be involved in any conferences in the future.

The FCA, the organisation responsible for regulating markets and traders in Britain, was looking into the matter, a spokesman said.


Company: cnbc, Activity: cnbc, Date: 2019-12-19
Keywords: news, cnbc, companies, clients, traders, newspaper, gave, highspeed, rogue, audio, start, england, boe, bank, supplier, feed, central, conferences, briefings, head


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Some advisors look beyond clients’ assets when giving investment advice

“We don’t use one-size-fits-all model portfolios or dictate a generic risk tolerance,” said certified financial planner Victoria Trumbower, managing member of Trumbower Financial Advisors in Bethesda, Maryland. Trumbower Financial ranked No. 22 on the CNBC FA 100 list of top financial advisors for 2019. For some financial advisors, the person behind the assets is the key to providing the best investment advice possible. There also might be insight to be gained from understanding a person’s inves


“We don’t use one-size-fits-all model portfolios or dictate a generic risk tolerance,” said certified financial planner Victoria Trumbower, managing member of Trumbower Financial Advisors in Bethesda, Maryland.
Trumbower Financial ranked No.
22 on the CNBC FA 100 list of top financial advisors for 2019.
For some financial advisors, the person behind the assets is the key to providing the best investment advice possible.
There also might be insight to be gained from understanding a person’s inves
Some advisors look beyond clients’ assets when giving investment advice Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-16  Authors: sarah obrien
Keywords: news, cnbc, companies, investment, look, study, assets, focus, advisors, giving, persons, advice, financial, understanding, clients, trumbower, portfolios


Some advisors look beyond clients' assets when giving investment advice

“We develop unique investment policies and design portfolios for each client,” Trumbower also said. “There is a consistent approach, but the assumptions all reflect their individual circumstances.”

“We don’t use one-size-fits-all model portfolios or dictate a generic risk tolerance,” said certified financial planner Victoria Trumbower, managing member of Trumbower Financial Advisors in Bethesda, Maryland. Trumbower Financial ranked No. 22 on the CNBC FA 100 list of top financial advisors for 2019.

That is, awareness of the nuanced differences that distinguish clients helps those advisors construct investment portfolios based on more than, say, a person’s age and how long until they need the money.

For some financial advisors, the person behind the assets is the key to providing the best investment advice possible.

“Our objective is to help them make better decisions but not impose our opinions on them,” Belej said.

“A person’s perspective on the world, their experiences, their emotions — that all plays a role in how we develop an investment policy for them,” said David Belej, partner and chief investment officer at Veritable in Newtown Square, Pennsylvania. Veritable also ranked on the CNBC FA 100 list , at No. 25.

Basically, the more an advisor knows about a person’s financial picture — for example, their short- and long-term goals, and views on money — the better they can accurately invest assets to reflect the client’s individual needs.

A person’s perspective on the world, their experiences, their emotions — that all plays a role in how we develop an investment policy for them.

There also might be insight to be gained from understanding a person’s investment approach, recent research suggests.

“The customary demographics — age, gender, marital status and income — aren’t always the most useful barometers for identifying ideal clients and understanding their needs,” according to a study released earlier this year by Edward Jones.

However, “it’s less about putting clients in one category or the other and more about just understanding that clients think differently,” said a company spokesperson in an interview earlier this year about the study, which split investors into two categories.

The first category, “traditionalists,” are described as more optimistic about market performance and comfortable with a buy-and-hold strategy. They also are more private about their finances. More than half of respondents (55%) fell into this group.

The remaining 45% are “trailblazers.” These folks are pessimistic about market performance, want holistic financial advice and are more willing to share their financial information, the research shows.

Commonalities do exist between the two groups, the study says. For example, among the survey respondents who focus on health and other significant expenses — regardless of which category they fell into — preparing for future medical expenses is more important than saving to buy a car or have emergency savings.

However, each group prioritizes major life expenses differently. For traditionalists, family-related aspects are the focus (32%), while personal education ranks highest among trailblazers (26%).

While not referring to the Edward Jones study, Belej said it can be hard to generalize when it comes to clients and that understanding each as an individual is an ongoing process.

“I don’t think listening to a client is a one-time thing,” Belej said. “It’s important to get to know the person over the long term, see how they’ve acted in the past and get to know their background.”

More from Financial Advisor 100:

Move to zero commissions concerns advisors

The worst money mistakes these advisors have seen

Advisor firms step up succession planning efforts

Separately, Trumbower has encountered new clients who discover through the financial-planning process that their existing investments might not reflect their views or their approach (whether conservative or riskier).

“They think their existing portfolios are consistent with the way they characterize themselves and are often surprised when we tell them what they really own,” Trumbower said.

Meanwhile, the Edward Jones research also looked at what investors consider when choosing a financial advisor.

Some differences between the two categories were more pointed than others: For example, 28% of traditionalists said fees were their biggest focus, compared with 12% of trailblazers. Of those who do focus on cost, though, more are concerned about investment fees and transaction fees or commissions than the advisor’s fees, the study shows.


Company: cnbc, Activity: cnbc, Date: 2019-12-16  Authors: sarah obrien
Keywords: news, cnbc, companies, investment, look, study, assets, focus, advisors, giving, persons, advice, financial, understanding, clients, trumbower, portfolios


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Millennial investors in this state have the highest liquid net worth: survey

The kids are all right in Washington state. At least that’s what Wealthfront, an investment management firm that provides robo-advisor services, found when it analyzed 201,486 of its clients across the country over the course of the year. Millennial investors — that is, individuals born between 1980 and 1994 — residing in the Evergreen State have a median liquid net worth of $112,618, Wealthfront found. The firm defined “liquid net worth” as the sum of a client’s Wealthfront accounts, plus the e


The kids are all right in Washington state.
At least that’s what Wealthfront, an investment management firm that provides robo-advisor services, found when it analyzed 201,486 of its clients across the country over the course of the year.
Millennial investors — that is, individuals born between 1980 and 1994 — residing in the Evergreen State have a median liquid net worth of $112,618, Wealthfront found.
The firm defined “liquid net worth” as the sum of a client’s Wealthfront accounts, plus the e
Millennial investors in this state have the highest liquid net worth: survey Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-11  Authors: darla mercado
Keywords: news, cnbc, companies, yearmillennial, survey, state, washington, clients, net, liquid, investors, firm, highest, thats, wealthfront, accounts, worth, millennial


Millennial investors in this state have the highest liquid net worth: survey

The kids are all right in Washington state.

At least that’s what Wealthfront, an investment management firm that provides robo-advisor services, found when it analyzed 201,486 of its clients across the country over the course of the year.

Millennial investors — that is, individuals born between 1980 and 1994 — residing in the Evergreen State have a median liquid net worth of $112,618, Wealthfront found.

The firm defined “liquid net worth” as the sum of a client’s Wealthfront accounts, plus the external bank accounts and other holdings that the client has linked back to the company.

Wealthfront adjusted the liquid net worth for the cost of living in each of the locales.


Company: cnbc, Activity: cnbc, Date: 2019-12-11  Authors: darla mercado
Keywords: news, cnbc, companies, yearmillennial, survey, state, washington, clients, net, liquid, investors, firm, highest, thats, wealthfront, accounts, worth, millennial


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Stitch Fix CEO talks up future for online fashion company as shares soar on strong quarterly results

Stitch Fix is finding success in an evolving retail landscape because its business embodies the new consumer preference, CEO Katrina Lake told CNBC on Tuesday. Investors on Tuesday, at least, were buying into the Stitch Fix story. The way in which subscribers can experience Stitch Fix also is changing, Lake noted. “It’s a very radically different e-commerce experience,” said Lake, who founded Stitch Fix in 2011. One area that Stitch Fix will not be experimenting with anytime soon, Lake said, is


Stitch Fix is finding success in an evolving retail landscape because its business embodies the new consumer preference, CEO Katrina Lake told CNBC on Tuesday.
Investors on Tuesday, at least, were buying into the Stitch Fix story.
The way in which subscribers can experience Stitch Fix also is changing, Lake noted.
“It’s a very radically different e-commerce experience,” said Lake, who founded Stitch Fix in 2011.
One area that Stitch Fix will not be experimenting with anytime soon, Lake said, is
Stitch Fix CEO talks up future for online fashion company as shares soar on strong quarterly results Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-10  Authors: kevin stankiewicz
Keywords: news, cnbc, companies, fixs, soar, stitch, future, million, online, results, strong, fix, items, experience, lake, subscribers, shares, talks, shop, quarterly, clients


Stitch Fix CEO talks up future for online fashion company as shares soar on strong quarterly results

Stitch Fix is finding success in an evolving retail landscape because its business embodies the new consumer preference, CEO Katrina Lake told CNBC on Tuesday.

“Today people want to be treated like unique individuals and they want to be respected for their preferences,” Lake said on “Squawk Alley.” “And I think our model is really well suited to deliver against that.”

Investors on Tuesday, at least, were buying into the Stitch Fix story. Shares of the clothing styling service were up more than 8% to around $27.10 on Tuesday after its quarterly results, which were released after the bell on Monday, eclipsed expectations.

The company, which went public in November 2017, turned in a breakeven quarter as analysts had forecast a loss of 6 cents per share. Revenue grew 21% year over year to $445 million, above the $441 million that had been expected.

Stitch Fix’s active clients matched analyst estimates at 3.4 million, a 17% increase from a year earlier.

In addition to the overall number of subscribers increasing, Stitch Fix also saw growth in the amount of money existing clients were spending — with revenue per client rising 10%.

That means clients are “buying more things, staying longer, having more successful experiences, and that is all great,” she said.

The way in which subscribers can experience Stitch Fix also is changing, Lake noted. Traditionally, Stitch Fix sent customers five items, chosen by a personalized stylist. Customers pay for the items they want to keep.

But in October, Stitch Fox began rolling out a new service called Shop Your Look, which shows subscribers around 30 to 40 items, utilizing data from their previous purchases, and gives them a chance to buy products individually.

“It’s a very radically different e-commerce experience,” said Lake, who founded Stitch Fix in 2011.

So far, Shop Your Looks is available to only 30% of Stitch Fix’s women’s clients, Lake said, “so we have a lot of work to do to optimize the feature” and make it available to its millions of subscribers.

Lake said she didn’t think Shop Your Looks cuts into the business of Stitch Fix’s traditional five-item boxes. Rather, she said it is “additive” and opens the door to further evolution of its business model, including expanding into holiday gifts, for example.

“The market opportunity for a more personalized apparel buying experience is enormous,” said Lake, who contended that the days of retailers saying, “This is the ‘it’ thing and everybody should go buy it, are gone.”

One area that Stitch Fix will not be experimenting with anytime soon, Lake said, is brick-and-mortar retail.

While some formerly online-only retailers such as Everlane have jumped into the world of physical stores, Lake said Stitch Fix hasn’t ruled it out but “we don’t have any plans in the near future to do that now.”


Company: cnbc, Activity: cnbc, Date: 2019-12-10  Authors: kevin stankiewicz
Keywords: news, cnbc, companies, fixs, soar, stitch, future, million, online, results, strong, fix, items, experience, lake, subscribers, shares, talks, shop, quarterly, clients


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