Despite a Tepid Q4, Managed Solutions Industry
Assets Grow to $2.7 Trillion in 2012, a 20% Increase 

S&P 500 Ends Down 0.4%

The managed solutions market ended the quarter with a modest growth rate of 2.7%, but experienced a significant
one-year growth rate of 20.1%, which translates into an increase of $459 billion. The industry hasn’t seen that type of growth since 2010, the same year that it surpassed $2 trillion in assets. The MS market continued to surpass the S&P 500 Index, which was down 0.4% for the quarter and was up 16% for the year.

  MMI Central 1Q13 (1.5 MiB)
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Retirement income planning and delivery is one of the hottest topics in the  financial services industry and, because of its inherent complexity, one of the thorniest. Seen by many as a major opportunity and the ‘next big thing,’ it has nonetheless been haltingly slow to arrive. In this Perspectives interview, Steve Gresham and Jack Sharry explore both the challenges and the progress along the road to the industry’s development of a truly comprehensive retirement income planning and implementation solution, a discussion for which both are eminently well qualified. Steve heads the Private Client Group at Fidelity Investments and is Visiting Instructor and Co-Chair of Brown University’s “As America Ages” project, and Jack chairs the MMI Retirement Solutions Committee and is Executive Vice President, Strategic Development at LifeYield.

  A Conversation with Steve Gresham and Jack Sherry (2.1 MiB)
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MMI WHITE PAPER:

MMI Survey of Platform Providers and Asset Managers

Executive Summary

The delivery of retirement income support is quickly moving from hype to reality for broker-dealers and product providers. With the oldest baby boomers having reached the traditional retirement age of 65, there is evidence of growing demand for retirement income and related support. Retirement remains the primary investment goal for the vast majority of retail investors. Despite the uncertain market environment, retirement income-oriented investors—those approaching retirement or already living in retirement—make up an increasing share of the new clients that financial advisors serve. It is within this context that the Money Management Institute (MMI) has partnered with GDC Research and Practical Perspectives—two leading independent consulting and research firms focused on the retirement income landscape—to explore how advisory platform sponsors and asset managers are evolving support to serve this growing market.

In August/September 2012, MMI surveyed member firms to learn more about current and anticipated efforts related to retirement income. The intent is to offer a brief snapshot of how organizations perceive the market for retirement income and to gain a deeper understanding of priorities, challenges, and expected enhancements to advisory programs and platforms. A total of 10 sponsors and 23 asset managers responded to the survey. The responses of these MMI members are supplemented by proprietary research conducted by GDC and Practical Perspectives.

  The Delivery of Retirement Income Support (3.5 MiB)
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The purpose of this document is to provide a basic overview of the federal antitrust laws as they relate to the activities surrounding the Money Management Institute (MMI). The information that follows provides guidelines on the problems that may arise in the course of MMI activities and situations that MMI members and staff should avoid. Should it appear that an antitrust violation has occurred, MMI members and staff should immediately inform the organization’s president.

Highlights of the document

Antitrust Guidelines
Price Fixing
Group Activities
Agreements
Suppliers and Service Providers
Conduct Guidelines

Antitrust Aspects of Particular MMI Activities
Lobbying Activities
Collection of Industry Data
Standard-setting Activities
Government Request for Information

 

  Download a copy of the MMI Antitrust Complaince Policy and Guidelines (1.0 MiB)
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FundFire Article on MMI Standards Effort

On December 18, 2012, FundFire published an article highlighting MMI’s ongoing efforts to help the industry develop and adopt standards to streamline communications between asset managers and platform sponsors. Click below to access the article on the FundFire website. 

Managed Solutions Market Regains Its Footing in Q3 2012
As Total Assets Increase 7% to $2.7 Trillion

New This Quarter: Exclusive Data Coverage of Model Portfolios in
SMA and UMA Advisory Platforms

The MS market recovered nicely in the third quarter and increased by about $175 billion in assets and was up 7.0% for the quarter. This growth outpaced the S&P 500 Index, which posted a third quarter return of 6.4%. The recent announcements of continuing central bank support and the rolling out of new monetary policies to help alleviate financially stricken countries seemed to be the impetus behind investor confidence. There was a rally in all the major markets.

  MMI Central - 4Q12 (1.5 MiB)
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To MMI Members:

We are pleased to present the 2012–2013 edition of the MMI Industry Guide to Managed Investment Solutions. Now in its fourth edition, the Guide continues to evolve in tandem with our industry. In addition to proprietary data and analysis on the managed solutions business and its most significant components, this edition provides MMI members with new statistics and a detailed look at historical and projected industry trends. 

In response to the considerable interest from our members, this edition is focused on alternative investments. Research indicates that the “retailization of alternatives” will unleash a wave of growth within the industry and fundamentally change both how advisors do business and the solutions they provide clients. The report contains unprecedented data, analysis and projections, including financial advisor survey results and the industry’s first distribution data on liquid and traditional alternative investments by product type and strategy from leading broker/dealers.

The Guide continues to represent the most comprehensive source of data and information on the managed solutions industry, and it will be an essential tool to help our members with strategic business planning. We welcome your comments and greatly appreciate the efforts of the MMI Governors and other members who contributed to the development of the Guide.

  Download the 2012 - 2013 MMI Industry Guide (3.7 MiB)
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October 19, 2012

TO: MMI Members

FROM: Roger Paradiso, Chair, MMI Model Standards Task Force
Gary Jones, MMI Consultant, Communication Standards

RE: Next Stage of Communication Standards Initiative

To move forward the communication standards effort, we have decided to issue a Request for Proposal (RFP) for the completion of the next stage of the managed solutions industry-supported initiative to create uniform data communication standards for managed accounts.

The next phase, which will focus on model portfolios, builds on a broader initiative under way for nearly a decade by MMI to improve data communication between the sponsors, investment managers, broker-dealers, and custodians that serve the managed accounts industry. The standards are designed to minimize risk, reduce costs, and improve the operational efficiency of the managed solutions industry, paving the way for future growth and expansion.

“At this juncture,” said Christopher L. Davis, President of MMI, “in assessing our objectives, we have made a strategic decision to adopt the same approach that we took with the successful MMI Sales Data Initiative. In that undertaking, after an RFP process, we selected Coates Analytics as a strategic partner whose role is to align its capabilities with the sales data reporting and analysis needs of MMI members.

“Similarly, to move the standards effort forward in a way that maximizes its utility and value to our members, we will now be seeking – with industry input – an infrastructure provider able to deliver an optimum communications utility that addresses the needs of our industry and MMI members as we see them today, as well as enhancements we envision for the future. As at the outset of this project, we remain committed to an open-source XML messaging standard – and invite all industry members to play a role in developing the protocols and schema.”

“This is a project that the industry supports because the lack of uniform communication standards only serves to inhibit industry growth,” said Roger Paradiso, Managing Director and Director of Consulting Group’s Investment Solutions and Portfolio Development at Morgan Stanley Wealth Management, who also serves as chairman of the MMI Board of Governors-level task force that oversees the standards effort. “We are particularly grateful to DTCC, the Depository Trust & Clearing Corporation, for its long-time support of our industry and its many contributions in bringing the standards project to its current stage.”

The model portfolio standards project will continue to be overseen by the task force of MMI Governors formed in June of this year. The task force both directs and supports the MMI Managed Account Solutions Standards (MASS) Committee, which has been the driving force behind the standards initiative since its inception in 2003. The task force will oversee the process of issuing the RFP—which is expected to be released by the end of October—as well as evaluate the potential candidates and select the provider that MMI will partner with on this important initiative.

As part of our efforts to improve delivery of compelling information to our members, MMI today released the inaugural edition of MMI Perspectives – the first in a series of occasional visits with thought leaders from both within and outside the wealth management industry. Like our first guest Paul Hatch, Vice Chairman of Morgan Stanley Smith Barney, those interviewed will offer a point of view on our industry that is both important and thought-provoking. Topics covered will range from broad overviews of the issues we face to in-depth explorations of specific industry challenges and opportunities.

Later this month, we will mail hard copies of the first issue of MMI Perspectives to our key contacts at all member firms. We hope you enjoy MMI Perspectives and look forward to your feedback.

  Click here to access the MMI Perspectives Series: Featuring Paul Hatch (1.3 MiB)
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