2016 Annual Convention

April 20-21, 2016 | Washington, DC
Marriott Marquis

Co-Chairs:
Ron Fiske, Managing Director, Envestnet
Brett Wright, Senior Vice President, Head of Third Party Distribution, Delaware Investments

Navigating Winds of Change

Download the Agenda

Change is a constant within our industry, and most would agree that the pace of change is accelerating. The headwinds driving change are rising from an increasingly broad range of sources – the regulatory sphere, global tensions and market uncertainties, technological innovation, the unsettled national political scene, generational shifts, and increasing marketplace competition – to name just a few. Thriving in such an environment – setting a course that rides the waves of opportunity created by disruption – requires anticipation, careful planning, and agility.


Additional Information

Agenda

Download DRAFT AGENDA

Navigating Winds of Change

Wednesday, April 20, 2016

12:45PM – 1:15PM
Welcome and Opening Remarks
John Sweeney, Chairman of the Board of Governors, Money Management Institute
Craig Pfeiffer, President & CEO, Money Management Institute

Convention Co-Chairs
Ron Fiske, Managing Director, Envestnet
Brett Wright, Senior Vice President, Head of Third Party Distribution, Delaware Investments

1:15PM – 2:00PM                    
Economic and Investment Outlook
Robert C. Doll, Senior Portfolio Manager, Chief Equity Strategist, Nuveen Asset Management

2:00PM – 3:00PM                    
The Changing Role and Face of Broker-Dealer Home Office Research
Home office investment manager research teams continue to grow in importance at broker-dealers. This panel will feature research heads from three unique broker-dealer channels – wirehouse, independent, and TAMP. You will hear:

  • how each team is staffed/structured and what it takes to catch the ear of the research associate covering your product,
  • what NOT to do with these teams, what challenges them, and what will alienate them,
  • how the research teams view the impact of the proposed DOL rule, 
  • how these groups interact with their counterparts in field sales and other internal groups, and
  • the impact of the growth of Rep as Portfolio Manager programs and how the research teams support the overlay portfolio manager structure.

Moderator: Matt Schleichkorn, Managing Director, Retail Sales & Marketing, Aristotle Capital
Panelists:
Bryan Luebbert, Principal, Portfolio Construction, Edward Jones
Ken Shaw, Senior Vice President, Investment Research, Envestnet Asset Management
James Peters, Head of Large Cap Due Diligence, Global Wealth and Investment Management, Merrill Lynch

3:00PM – 3:30PM
Solutions Spotlight
In this fast-paced session, two of our Annual Convention sponsors will offer quick-hitting “TED Talk”-style presentations that focus on timely topics pertinent to our conference theme. Prepare to be engaged and entertained.

3:30PM – 4:00PM                    
Refreshment and Networking Break with Exhibitors

4:00PM – 5:15PM        
Concurrent Breakout Sessions (choose one of three)

Digital Delivery of Personalized Advice: The True Impact of “Robo” on the Wealth and Asset Management Industry
The discussion of digitally-delivered automated investment services is often framed inappropriately as “robo” vs. traditional advice delivery methods. The reality is far more complex, with robo-advisors creating a ripple effect throughout the wealth and asset management industry. Their disruptive nature is rooted in several trends:

  • the accelerating use of low-cost ETFs and passive products,
  • intensifying fee pressures on advisors and mutual funds,
  • the impact of the DOL fiduciary rule on advice models as well as on product and platform offerings,
  • clients’ heightened expectations of sophisticated digital access, experiences, and interactions, and
  • next-generation integration of active and passive strategies.

With more and more established wealth and asset managers embracing the trend toward automated investment management, this panel will explore the current digital delivery landscape and how it is likely to evolve.
Moderator: Jeff Welday, Executive Vice President, National Sales Director, Invesco
Panelists:
Tom Kimberly, General Manager, Betterment Institutional
Noni Robinson, Principal, Vanguard Financial Advisor Services
Simon Roy, President, Invesco Jemstep

Diverging Viewpoints: Compensation Models in the Advisory Solutions Industry
Today, more asset managers are looking beyond traditional compensation models, i.e., gross sales commission, and are experimenting with paying commissions based on asset retention, metric-driven bonuses, and other new approaches. The program provides an academic look at several alternative compensation approaches, providing “pros” and “cons” to each, which should be both insightful and useful to attendees as they look at their individual business models and make independent business decisions.  Our panel, which includes executives from a variety of businesses will provide perspective on compensation trends including:

  • forms of compensation
  • gross vs. net-based components,
  • long-term incentives, such as equity, and
  • non-financial rewards, such as culture, flexibility, and training.

MMI is a trade association that provides educational content to its members. MMI strictly adheres to the antitrust laws.  The presentation, Diverging Viewpoints:  Compensation Models in the Advisory Solutions Industry, is offered to inform attendees about various compensation models.  MMI, nor the presenters, are not advocating for adoption of any specific compensation model or the creation of uniformity within the industry. Attendees are cautioned that the information presented should not be the subject of joint discussions related to any “agreements” about business practices and attendees should use (or ignore) the information to make individual business decisions.
Moderator: Brett Wright, Senior Vice President, Head of Third Party Distribution, Delaware Investments
Panelists:
Jason Brown
, Principal, ZS Associates
Ben Doob, Managing Principal, Market Metrics
Brian Kilcullen, President, Kilcullen & Company

Helping Advisors Articulate Their Value Proposition
With all of the buzz surrounding digital advice, the importance of articulating the true value that the advisor brings to the client-advisor relationship – the ability to manage investor behavior – cannot be overstated. This session will focus on the ways in which firms are helping advisors to better communicate the value they bring to clients, especially during a period marked by disruption and transition. Learn how future-ready advisors are embracing the unique power of “behavioral alpha” – adding to real returns through a structured process of behavioral coaching.  
Moderator: Ali McCarthy, National Director of Marketing, Brinker Capital
Panelists:
Dr. Daniel Crosby, Executive Director, The Center for Outcomes
Chris Jeppesen, Senior Vice President, Chief of Advisory Practices, First Trust
Paul Pagnato, Managing Director, Partner & Founder, Pagnato Karp, HighTower

5:30PM – 6:00PM
Special Guest Speaker
U.S. Senator Shelley Moore Capito

6:15PM – 7:15PM
Reception and Networking with Exhibitors

7:15PM – 10:00PM
Gateway to Leadership Industry Recognition Dinner

Thursday, April 21, 2016

7:00AM – 8:00AM                  
Breakfast and Networking with Exhibitors

8:00AM – 8:15AM                  
Co-Chair Recap of Day One

8:15AM – 9:00AM
Opening Keynote Session
John Taft, CEO, RBC Wealth Management - U.S.

9:00AM – 10:00AM
Executive Spotlight: Advisory Solutions in the Decade Ahead  
A panel of senior financial services executives moderated by MMI President and CEO Craig Pfeiffer share insights about the opportunities and challenges that lie before investors, advisors, asset managers, and sponsor firms in the coming decade. Topics will include:

  • Solving the Talent Shortage – With a looming talent shortfall as Boomers retire, how will next gen advisors and employees be attracted to the industry and effectively trained? 
  • The Industry Diversity Challenge – Why does the issue still persist after many discussions and initiatives? What new steps are needed to move the needle and effectively address the challenge?
  • The Evolution of Advice and Service Delivery – Against a backdrop of clients’ increasingly complex needs, an abundance of choices, and heightened expectations of personalized solutions, traditional and digital advice models are converging. With the bar raised and the industry focused on delivering new levels of consumer accessibility, support, and value, are advice and service models becoming more integrated?
  • Regulatory Reform Beyond the DOL Fiduciary Rule – Full agendas at the SEC and FINRA promise that even more regulatory pressure is in the offing with cyber security high on the list.

Moderator: Craig Pfeiffer, President & CEO, Money Management Institute
Panelists:

Christine Nigro, Vice Chairman, AXA Advisors
John Moninger, Director of Retail Sales, Eaton Vance
Jim Tracy, Head of Consulting Group, Morgan Stanley

10:00AM – 10:30AM
Refreshment and Networking Break with Exhibitors

10:30AM – 11:00AM
Solutions Spotlight
Round 2 of our “TED Talk”-style presentations with two more thought-provoking takes on topics that relate to our conference theme of “Navigating Winds of Change.”

11:00AM – 12:00PM
What’s Beyond the Horizon for Asset and Wealth Management?
With previous sessions having explored the massive regulatory, technology, and distribution changes confronting the industry, this session will delve deeper into the practical implications of those trends for both asset managers and distributors. Topics include the ramifications of:

  • the DOL fiduciary rule and the generally more challenging regulatory environment,
  • the ever more complex landscape of investment solutions,
  • the increasing usage of analytical tools to help drive decisions, and
  • the evolving behavior and needs of both investors and advisors.

Moderator: Ron Fiske, Managing Director, Envestnet Asset Management
Panelists:
Tyler Cloherty, Senior Manager, Casey Quirk 

Steven Miyao, President, DST kasina

12:00PM – 1:00PM
General Session with Luncheon Speaker
Andy Friedman, Principal, The Washington Update
Sponsored by:  
According to CNBC, Andy Friedman is “one of the nation’s most sought-after speakers on all things political.” An expert on political affairs, Andy is known for predicting the outcomes of Washington deliberations and providing financial advisors and investors with strategies to consider in light of the changing political landscape. Andy was a senior partner with the law firm of Covington & Burling in Washington, D.C., where he practiced for almost thirty years, serving as head of the tax and corporate groups. He received his bachelor degree as valedictorian from Trinity College in Hartford, Connecticut, and his law degree from the Harvard Law School. Andy also served as tax counsel to Major League Baseball, the National Football League, the National Basketball Association, and the National Hockey League. Andy appears on CNBC, which refers to him as “Wall Street’s Tax Expert” and calls him “one of Washington’s savviest political observers.” Andy also has appeared on the Larry Kudlow Show, the Fox Business Channel, and POTUS radio, has been profiled in the Washington Post and Research Magazine, and is quoted extensively in publications ranging from the Wall Street Journal to USA Today. Andy is included in Best Lawyers in America and Chambers’ America’s Leading Lawyers for Business, which notes that “Andy’s ability to combine vast knowledge and a practical mindset permits him to convey the most complex of tax concepts in layman’s terms. He is the expert’s expert. If every lawyer were like him, the world would be a much better place.”

1:00PM –1:15PM
Closing Remarks & Adjournment

Craig Pfeiffer, President & CEO, Money Management Institute

1:30PM – 5:00PM
DOL Fiduciary Rule Roundtables – Moving to Implementation

MMI Members Only; No Press

Now that the DOL's long-awaited and controversial final fiduciary rule has been released, the focus is moving beyond discussion and speculation to action plans and execution. While we are collectively still reviewing and digesting the specifics of the final rule, the prevailing view is that the DOL did listen to industry concerns and offer certain compromises which make the final rule more workable. Still there are far-reaching consequences for broker-dealers, financial advisors, and asset managers impacting their product, sales and business practices, and many other areas. These special Roundtables will provide a closed-door forum for senior business leaders to discuss implementing the final DOL rule.

1:30PM – 2:15PM
Deconstructing the Final Rule
To kick things off, Steve Stone and Dan Kleinman of Morgan Lewis will provide an overview of the final rule and its specific impact on managed accounts. Topics will include:

  • significant changes in the final rule,
  • its definition of fiduciary,
  • the best interest contract exemption
  • the impact on model manager arrangements, and
  • the implications for selling managed account programs.

Steven W. Stone, Partner, Morgan, Lewis & Bockius LLP
Daniel R. Kleinman, Partner, Morgan, Lewis & Bockius LLP

2:15PM – 3:15PM
Complying with the Rule: What are the Key Business Implications?
This panel of senior business leaders will discuss what complying with the final rule means for asset managers, sponsor firms, and financial advisors and how business practices will change in a post-DOL world. Among the key discussion topics:

  • the principal side effects for managed account programs
  • the impact on marketing and sales practices – particularly with respect to IRA clients 
  • the likelihood of a widespread shift from commission-based to fee-based advisory business
  • the probability of share class consolidation or the emergence of new share classes
  • the prospect of dealing with enforcement through the court system

Moderator: Frank Gregory, Chief Distribution Officer, BPV Capital Management
Panelists:
Robert Cirrotti
, Managing Director, Head of Retirement & Investment Solutions, Pershing LLC, a BNY Mellon company

Margaret Raymond, Managing Counsel, Retirement & Tax Deferred Investing Group, T. Rowe Price Associates

3:30PM – 4:15PM
Concurrent Breakout Sessions (choose one of two)

Sponsor Firm Breakout
The final rule compels firms and financial advisors to examine their business models and may likely require significant changes to current operating practices. This breakout session will give sponsor firm representatives an opportunity to focus on and discuss the critical issues involved in implementing and complying with the rule from a platform sponsor perspective:

  • Pricing: What are the implications and anticipated changes to advisory program pricing?
  • Proprietary product: How will the BIC exemption requirements impact the distribution of proprietary products?
  • Manager research: Will the rule change how firms approach the manager research function?
  • Tipping point: Will the rule’s implementation become an impetus for some advisors to transition all of their client relationships – not just their retirement ones – to fee-based accounts?
  • Account format: In the evolution of advisory platforms, will the UMA format become the structure of choice?
  • Robos: Will the use of automated digital advice to service small accounts and plans now be fast tracked?

Facilitator: Jason Blackwell, Principal, Mercer

Asset Manager Breakout
This session will allow asset manager representatives to discuss the particular hurdles they face in adjusting their business models and strategies to comply with the new rule. Chief among them is working with key distribution partners to both deepen relationships and ensure that their marketing, sales and compensation practices are aligned to comply with the rule as adopted. Among the topics this session explores:

  • Model managers: Are non-discretionary model managers exempt from the fiduciary definition?
  • Product shift: Will the shift from higher-cost actively managed products to lower-fee passive products be accelerated by the rule’s adoption?
  • Endangered products: Although the rule allows the continued sale of products such as equity-indexed annuities and nontraded REITs, what is the anticipated impact on these products?
  • Share classes: What mix of share classes will clients demand to grow their businesses?
  • Service agreements: What is the likely impact to existing service agreements?
  • Product capabilities: Do managers’ current capabilities align with the likely adjustments distributors will make to their business models?
  • Marketing: Are current practices and materials consistent with the rule’s requirements?

Faciliator: Scott Campion, Partner, Oliver Wyman

4:30PM – 5:15PM
Quick Fire Review and Q&A
Our final session will start with a report out from the Asset Manager and Sponsor Firm breakout groups – with each sharing key takeaways and primary challenges. Next Craig Pfeiffer will moderate a Q&A session with a panel of senior business leaders and subject matter experts. This open-ended forum is your chance to ask any questions that are still on your mind and gain insight and perspective from our panelists and your fellow attendees.

Moderator: Craig Pfeiffer, President & CEO, Money Management Institute

Panelists:
Scott Campion,
Partner, Oliver Wyman
Robert Cirrotti, Managing Director, Head of Retirement & Investment Solutions, Pershing LLC, a BNY Mellon company
Jason Blackwell, Principal, Mercer
Joe Mrak, Chairman & CEO, FolioDynamix
Margaret Raymond, Managing Counsel, Retirement & Tax Deferred Investing Group, T. Rowe Price Associates

Hotel Information

Marriott Marquis Washington, DC
901 Massachusetts Avenue NW
Washington, DC 20001
Tel: (877) 212-5752

As of April 5th, the MMI room block and preferential rate at the Marriott Marquis are no longer available. Rooms may still be available at the Marriott Marquis’ currently best available rate.

Other hotel properties in the vicinity:

 

Registration Fee

The general registration fee is $1,650.00. The special registration fee for MMI members is $1,350.00.

Cancellations: No refunds will be granted for cancellations after 5:00pm ET on Friday, April 1st. Substitutions are permitted. Please notify MMI at (202) 822-4949.

Did You Know? Volume Discount for Multiple Attendees
Once two attendees from your firm are registered for the Convention at the standard registration fee, all subsequent attendees are eligible for a 20% discount. Contact MMI headquarters at (202) 822-4949 for details and the special code to use during the registration process.

2016 MMI Industry Leadership Recognition Dinner

On the evening of Wednesday, April 20, we will present the annual MMI Industry Leadership Awards recognizing achievement and innovation in advisory solutions and honor our 2016 Advisory Solutions Pioneer. The dinner is also a fundraiser for MMI's Gateway to Leadership workplace diversity program - join us to honor our industry's outstanding performers while supporting a very worthwhile cause. 

Individual tickets and tables for the dinner can be purchased as part of your Annual Convention registration or separately here.  

As Gateway to Leadership is a 501(c)(3) charity, $175.00 of the individual seat fee and $1,300.00 of the table fee is tax deductible.

MMI Advisory Solutions Pioneer Award

Each year, MMI honors one or more individuals with its prestigious Pioneer Award at the Industry Leadership Awards dinner during the Annual Convention.

The Pioneer Award, first awarded in 1998, honors individuals who embody MMI’s mission to serve as an advocate and catalyst for the growth of the advisory solutions and wealth management industry. As its name suggests, the award is bestowed on trailblazers who exemplify the pioneer spirit and are leading the industry forward in new and transformative directions. View the distinguished list of past Pioneer winners

Dinner Committee

For 2016, the MMI Leadership Advisory Council has served as the organizing committee for the Industry Leadership Recognition Dinner. MMI greatly appreciates the guidance and strategic oversight of the members of the Leadership Advisory Council:

Marie Dzanis, Co-Chair       Northern Trust Investments, N.A.
Joe Vinci, Co-Chair Deutsche Bank
Claire Comerford AXA Advisors
Macdonald Etugbo USAA Investment Management Company
Karen Heath-Wade Nationwide Financial
Joel Hempel Lockwood Advisors, Inc.
Tim Hill Principal Global Investors
Jay Link Merrill Lynch
Cheryl Nash Fiserv
Greg Nordmeyer Ameriprise Financial Services
Curt Overway Natixis Global Asset Management
Gary Rozier Ariel Investments
Peter Thatch American Funds
Steven Truong Albridge Analytics

 

 

 

Featured Speakers

Bob Doll
Keynote Speaker
Bob Doll
Senior Portfolio Manager
Chief Equity Strategist
Nuveen Asset Management
John Taft 
Keynote Speaker
John Taft

CEO
RBC Wealth Management - U.S.
Senator Shelley Moore Capito
Special Guest Speaker
U.S. Senator
Shelley Moore Capito

 

The DOL Fiduciary Rule: Moving to Implementation

* NEW *

With the release of the DOL's fiduciary rule now anticipated as early as April 4th, the industry focus is moving beyond discussion and speculation to action plans and execution. While the exact details of the final rule are still unknown, there is widespread agreement that the rule will have far-reaching consequences for broker-dealers, financial advisors, and asset managers impacting their product, sales and business practices, and many other areas.

To provide an open forum for senior business leaders to discuss implementing the final DOL fiduciary rule, MMI is adding several roundtable discussions after the formal conclusion of the MMI Annual Convention on the afternoon of Thursday, April 21st in Washington, DC. 

The roundtables are scheduled for 1:30pm - 5:00pm and are open to all MMI members attending the Convention. You can also register separately here for the DOL rule roundtables or Day 2 of the ConventionThese sessions will be closed to the press. 

 

 

1:30PM – 5:00PM
DOL Fiduciary Rule Roundtables – Moving to Implementation

MMI Members Only; No Press

Now that the DOL's long-awaited and controversial final fiduciary rule has been released, the focus is moving beyond discussion and speculation to action plans and execution. While we are collectively still reviewing and digesting the specifics of the final rule, the prevailing view is that the DOL did listen to industry concerns and offer certain compromises which make the final rule more workable. Still there are far-reaching consequences for broker-dealers, financial advisors, and asset managers impacting their product, sales and business practices, and many other areas. These special Roundtables will provide a closed-door forum for senior business leaders to discuss implementing the final DOL rule.

1:30PM – 2:15PM
Deconstructing the Final Rule
To kick things off, Steve Stone and Dan Kleinman of Morgan Lewis will provide an overview of the final rule and its specific impact on managed accounts. Topics will include:

  • significant changes in the final rule,
  • its definition of fiduciary,
  • the best interest contract exemption
  • the impact on model manager arrangements, and
  • the implications for selling managed account programs.

Steven W. Stone, Partner, Morgan, Lewis & Bockius LLP
Daniel R. Kleinman, Partner, Morgan, Lewis & Bockius LLP

2:15PM – 3:15PM
Complying with the Rule: What are the Key Business Implications? 
This panel of senior business leaders will discuss what complying with the final rule means for asset managers, sponsor firms, and financial advisors and how business practices will change in a post-DOL world. Among the key discussion topics:

  • the principal side effects for managed account programs
  • the impact on marketing and sales practices – particularly with respect to IRA clients 
  • the likelihood of a widespread shift from commission-based to fee-based advisory business
  • the probability of share class consolidation or the emergence of new share classes
  • the prospect of dealing with enforcement through the court system

Moderator: Frank Gregory, Chief Distribution Officer, BPV Capital Management
Panelists:
Robert Cirrotti
, Managing Director, Head of Retirement & Investment Solutions, Pershing LLC, a BNY Mellon company
TBA

3:30PM – 4:15PM
Concurrent Breakout Sessions (choose one of two)

Sponsor Firm Breakout
The final rule compels firms and financial advisors to examine their business models and may likely require significant changes to current operating practices. This breakout session will give sponsor firm representatives an opportunity to focus on and discuss the critical issues involved in implementing and complying with the rule from a platform sponsor perspective:

  • Pricing: What are the implications and anticipated changes to advisory program pricing?
  • Proprietary product: How will the BIC exemption requirements impact the distribution of proprietary products?
  • Manager research: Will the rule change how firms approach the manager research function?
  • Tipping point: Will the rule’s implementation become an impetus for some advisors to transition all of their client relationships – not just their retirement ones – to fee-based accounts?
  • Account format: In the evolution of advisory platforms, will the UMA format become the structure of choice?
  • Robos: Will the use of automated digital advice to service small accounts and plans now be fast tracked?

Facilitator: Jason Blackwell, Principal, Mercer

Asset Manager Breakout
This session will allow asset manager representatives to discuss the particular hurdles they face in adjusting their business models and strategies to comply with the new rule. Chief among them is working with key distribution partners to both deepen relationships and ensure that their marketing, sales and compensation practices are aligned to comply with the rule as adopted. Among the topics this session explores:

  • Model managers: Are non-discretionary model managers exempt from the fiduciary definition?
  • Product shift: Will the shift from higher-cost actively managed products to lower-fee passive products be accelerated by the rule’s adoption?
  • Endangered products: Although the rule allows the continued sale of products such as equity-indexed annuities and nontraded REITs, what is the anticipated impact on these products?
  • Share classes: What mix of share classes will clients demand to grow their businesses?
  • Service agreements: What is the likely impact to existing service agreements?
  • Product capabilities: Do managers’ current capabilities align with the likely adjustments distributors will make to their business models?
  • Marketing: Are current practices and materials consistent with the rule’s requirements?

Faciliator: Scott Campion, Partner, Oliver Wyman

4:30PM – 5:15PM
Quick Fire Review and Q&A
Our final session will start with a report out from the Asset Manager and Sponsor Firm breakout groups – with each sharing key takeaways and primary challenges. Next Craig Pfeiffer will moderate a Q&A session with a panel of senior business leaders and subject matter experts. This open-ended forum is your chance to ask any questions that are still on your mind and gain insight and perspective from our panelists and your fellow attendees.

Moderator: Craig Pfeiffer, President & CEO, Money Management Institute
Panelists: TBA

Sponsor & Exhibitor Opportunities Available

Are you interested in an economical way to:

MMI Annual Convention Sponsor and Exhibitor Opportunities

  • build relationships with senior decision makers at asset managers and distributors?
  • create additional awareness of your firm's products and services?
  • stay current with customers, prospects and competitors? 

A limited number of high-profile sponsorship opportunities - including the opening cocktail reception, the wine sponsorship at the gala Industry Leadership Awards Dinner, and the conference Wi-Fi - are still available at the 2016 MMI Annual Convention taking place April 20 - 21 at the Marriott Marquis Washington DC

There are also a handful of exhibit booth spots available so please contact us immediately if you are interested.

MMI events represent an exceptional opportunity to meet with investment advisory executives, gain strategic insights, and highlight your firm's offerings. The Annual Convention will bring together up to 400 industry stakeholders, business leaders, and key decision makers for two days of thought-provoking sessions and networking opportunities.

The dedicated exhibit hall - located in the middle of the action - is an ideal venue to showcase your firm's products and generate brand awareness with our highly-engaged audience of senior decision makers. The attached prospectus contains more information about the conference and package specifics.

Download Prospectus

Please contact Linda Pierre at (202) 822-4949 or lpierre@mminst.org for details and to discuss a package that meets your firm's needs.

Questions?

Attendee Registration:
Nia Edwards - nedwards@mminst.org
(202) 822-4949

Speaker Registration:
Laura Payne - lpayne@mminst.org
(202) 822-4949

Fees & Billing:
events@mminst.org
(202) 822-4949

Sponsorship Opportunities:
Linda Pierre - lpierre@mminst.org
(202) 236-0935

Recap: 2016 MMI Annual Convention

MMI 2016 Annual Convention

In welcoming remarks to the more than 310 members attending the 2016 MMI Annual Convention April 20-21 in Washington, DC, new MMI Chairman John Sweeney underscored the aptness of the conference theme, Navigating Winds of Change. “While change is constant in the financial services industry, there are certain periods in one’s career where change is more significant than in others…I believe 2016 will be a year we look back on as one of very profound change in our industry for customers and for ourselves as professionals.”

Change was, indeed, the starting point for each of the meeting’s special guest speakers as well as each of the sessions. Of course, the “elephant in the room,” as one speaker put it, was the recently published DOL fiduciary rule – a much discussed topic in the formal sessions as well as in the hallways between sessions. MMI has moved quickly on its pledge to help members navigate the implications and challenges associated with the final rule, and the first step in that process was a member-only DOL roundtable held after the Convention’s formal adjournment. The Thursday afternoon program attended by more than 100 members included an overview of the rule and its impact on managed accounts, a discussion of implementation strategies, and separate breakout sessions for sponsors and asset managers followed by a quick-fire review and Q&A.

The next step in MMI’s education and support program for members is a DOL Fiduciary Rule Forum on Wednesday, May 25 at The Yale Club in New York City. Please note that May 25 is a new date for the Forum – rescheduled from the originally announced date because of a conflict with another industry event.

Following Mr. Sweeney’s welcoming remarks, MMI President and CEO Craig Pfeiffer gave a “state-of-the-state” review of progress on MMI’s five key strategic priorities: enhancing the membership experience, educational initiatives, deepening data resources and analytics, fostering next generation industry and MMI leadership, and advocacy that moves the advisory solutions industry forward.  

Economic and Investment Outlook: Flat Market, Strong U.S. Consumer, No Recession
Robert Doll
, Nuveen’s Chief Equity Strategist, opened with his keynote with an assessment of where the markets are now and where they are headed. “We are in a period in which we are frustrating both the bulls and the bears…an environment where it’s tough for beta to work. The first quarter of this year was the first quarter in U.S. equity market history when the market went down a double-digit percentage, up a double-digit percentage, and ended flat. We went a long way to go nowhere, and, sadly, I think it’s going to be the tale of the environment we are in.”

Since he cannot foresee a double-digit up year because of the deflationary problems overseas or a double-digit down year because of some of the good things happening primarily around the U.S. consumer, he concluded, “This is an alpha year – with the markets flat, all of a sudden two or three points of alpha are everything.”

Predicting a 7% return from stocks this year, assuming 5% earnings growth, flat price-to-earnings ratios, and 2% in dividends, his relative optimism stems from the fact that “…U.S. consumers are in better shape than most people give them credit for…Job growth is strong – we had more new jobs than ever before in the past five years, and there are more high-paying ones than low-paying, refuting another myth that is out there. Wage rates are starting to move up, a little more tailwind for the U.S. consumer.” Low interest rates have enabled debt refinancing, putting more dollars in consumer pockets. In addition, there is the energy dividend: “The decline in oil from $100 to $30 is more powerful for U.S. consumers than any tax cut they ever got.”

A recession is not in the cards, Mr. Doll reasons, because the typical preconditions for the end of a bull market – accelerating inflation, tight money, excessive wage growth, high interest rates, and investor euphoria – are just not there. “But while the bull market for stocks is not over, it is no longer young and vibrant. It is old and wrinkled and uses a cane to cross the street.”

The Changing Role and Face of Broker-Dealer Home Office Research
A panel featuring research heads from three different broker-dealer channels – wirehouse, independent, and TAMP – explained in depth their views on the do’s and don’ts for asset manager sales teams dealing with distribution platform gatekeepers. First, as one panelist explained, understanding the distributor’s needs is critical, and throwing five or six products on the table at once is a bad idea. “The reality is that the hard push on something that is not our top priority is plainly not going to work,” a panel member warned. “Put yourself in our shoes, and recognize what is going to look good and work from our perspective. If you have limited time, you want to put your best foot forward by avoiding spending time on a product you learned during the due diligence process is probably not going to be selected.”

Equally important are honesty and building trust. An example was given of a large asset manager with a product that had a great track record telling an analyst, “Just so you know, recently they have had tremendous turnover in the portfolio management.” That is something the distributor would have found out when researching the product, but by disclosing it early, the manager builds trust, and the next time the distributor gets a call from him saying this is a product I want you to look at, he will probably listen.

Transparency is paramount. Talk openly about what developments both good and bad mean and your strategy going forward around them. “And then there is timeliness,” a panelist commented. “Make sure we know about something before the advisors do – that’s the worst thing that can happen. Building and servicing the heck out of the relationships you have is the best way to grow a business.”

In building a relationship, play the long game – “It’s a marathon, not a sprint.” Ask what the distributor is focused on for the next six months. Don’t be the one who says for every single search that you’ve got the perfect strategy. Be willing to say that is not our area, we specialize in something else and move on. And later, when that something else is being sought by that same distributor, you will be considered. When you get a meeting, make the most of it by bringing the right person to the table, and be aware of the time limitations on the other side of the table. Make sure that every conversation, every email is adding value for the analysts. Lastly, make sure your products are in the relevant data bases.

Breakout Sessions:

Digital Delivery of Personalized Advice: The True Impact of “Robo” on the Wealth and Asset Management Industry
In an expert discussion of “robo” advice delivery, panel members from Invesco Jemstep, Betterment Institutional, and Vanguard Financial Advisor Services offered their perspective on the target market for robos, the breadth of and limitations on the range of services that robos can provide, the growth potential for robos, the role of the human advisor in the robo matrix, robos’ impact on the trend toward passive investment products, and the cost and fee pressures robos are bringing to bear on the advice industry.

Diverging Viewpoints: Compensation Models in the Advisory Solutions Industry
This panel moderated by Convention Co-Chair Brett Wright took a step back and surveyed what is happening beyond traditional compensation models based on gross sales commissions. It looked at the pros and cons of alternative models with commissions based on asset retention, metric-driven bonuses, gross vs. net-based approaches, and long-term incentives.

Helping Advisors Articulate Their Value Proposition
This panel discussion focused on the ways in which firms are helping advisors better communicate the value they bring to clients at a time when they are being pressured by the growing strength of the movement toward digital advice. It also took a look at how some advisors are embracing the unique power of “behavioral alpha” – adding to real returns through a structured process of behavioral coaching.  

Gateway to Leadership Dinner: Honoring Industry Achievement 
The eighth annual Industry Leadership Recognition dinner to raise funds to support MMI’s Gateway to Leadership workplace diversity program brought day one of the Convention to a fun-filled close. MMI’s Board of Governors honored Robert Noelke, a recently retired Partner at Lord, Abbett & Co., as the 2016 Advisory Solutions Pioneer, and ten firms were recognized with Industry Leadership Awards for their innovation and achievement in advisory solutions over the past year. In addition, DTCC received the MMI Gateway to Leadership Award in recognition of its long-term commitment to and support of Gateway to Leadership. Thanks to the generosity of the audience and donors and the auctioneering skills and humor of Bill Brennan and Mike Murphy, the dinner raised significant funds to help support the Gateway program.

Keynote Speaker: A Single Uniform Fiduciary Standard Becomes the Final Step in the Full Professionalization of Wealth Management
Kicking off day two, John Taft – CEO of RBC Wealth Management - U.S. – argued that our industry should embrace comprehensive wealth management. “Someone used the analogy that our clients walk into our offices wanting to know how to get from Minnesota to Florida. We sit down and don’t even talk to them about what kind of car they should use to get there. We talk to them about steering wheels, tires, and mufflers – stocks, bonds, and mutual funds. What they want to know is how do I get to Florida? That’s goals-based wealth management, and we have evolved to that.”

In that evolution, the industry has developed a comprehensive suite of services that includes risk management, lending, long-term care, and estate planning that go alongside the investment products. “That comprehensive suite of services and the advice and discovery that drives it is available today at a fraction of the cost of what it was 30 years ago. It is being delivered by advisors who are infinitely more qualified, better trained professionals than they were 30 years ago.” Firms have also, Mr. Taft pointed out, been investing heavily in training teams of expert resources and in technology – aggregation tools, integrated reporting, document management vaults, cash management capabilities.

“The difference is night and day, and yet that story, which is a good story, hasn’t been effectively told. The result of that is the fragmented, conflicting and extremely complex regulatory regime we are operating in today, and it is only going to get worse, not better in the near future.” Starting from the fact that there are currently four “flavors” of fiduciary rule coming from the chief regulatory bodies, Mr. Taft advocated at the close of his remarks a Presidential Commission or some other kind of high-level task force charged with creating a uniform umbrella fiduciary standard that applies to everyone in the industry. “A uniform fiduciary standard is the final stone in the path toward the full professionalization of the wealth management industry.”

Executive Spotlight: Advisory Solutions in the Decade Ahead
Senior financial services executives Christine Nigro, Vice Chairman, AXA Advisors, John Moninger, former MMI Chair and Director of Retail Sales, Eaton Vance, and Jim Tracy, Head of Consulting Group and Practice Management, Morgan Stanley, explored in an “open chat” panel moderated by Craig Pfeiffer major trends that are certain to affect the future path of advisory services.


In a discussion about the DOL fiduciary rule, Mr. Tracy commented that, “Whatever you may think about the rule, it has made us rethink the business. The fact of the matter is we now have the rule and have to move forward and adjust our businesses accordingly…As I see it, most firms have reacted very well to the fact that there needs to be some modifications to the business.” Mr. Moninger pointed out that historically most important industry developments have been driven by regulatory change, and with that change has come opportunity, an observation supported by Ms. Nigro. One of her principal concerns, however, is that small clients who will no longer be as easy to serve on a one-on-one basis will be hurt by the rule’s implementation.

Turning to digital advice, Mr. Moninger asked whether robos could effectively provide the level of personalization that investors are requiring today, especially Millennials. “Can technology help us make better decisions and provide a better experience for a client? Absolutely. What we should embrace is continuing to improve the client experience, providing better personalization and being able to substantiate the value of the fees we are charging. That’s the opportunity we have to differentiate ourselves from what else is available.” Mr. Tracy predicted that robos will end up driving growth in the wealth management business by pulling into the industry some of the 87 million Millennials who might not otherwise invest.

The panel also addressed three demographically related topics – the looming shortfall in advisors as Boomers retire, the need to attract and train the next generation of advisors, and need for greater diversity across the industry, which Mr. Tracy termed the biggest challenge confronting the industry.

What’s Beyond the Horizon for Asset and Wealth Management?
A panel moderated by Convention Co-Chair Ron Fiske started off with an industry overview indicating that, while the last four to five years have been remarkably good for the asset management industry – revenues are up, margins are up – the news is not uniformly good. Although there has been an increase in revenues, they are not growing as fast as assets are increasing, and the industry is starting to see fee compression. Once we encounter choppy market returns, a much bigger spread is foreseen in margins between profitable managers who are winning and taking share and those who are starting to lose share.

It was noted that margins have held steady primarily because of cost cutting and improving efficiency. The probability of 2% industry growth isn’t, however, a bad story when you look globally. The U.S. market is quite robust and relatively attractive compared to the rest of the world, and one panelist sees much more competition on the way. “It’s going to be a take-away game going forward.”

Active vs. passive? “At every conference we go to, we have this conversation. This conversation should be over. Neither one is going away, and they will be part of every advisor’s portfolio. An asset manager should be asking what part of his or her value proposition either style represents. The sales approach has to change. We have to understand the data, understand who these advisors are, and find the areas where active management delivers the most value.”

Looking ahead, the industry will be very different in five years, but the way the industry is changing is not the result of the DOL rule, which is just accelerating that change. The three key change elements are the move to fee-based compensation that the wirehouses are encouraging, the trend toward robo advisors, and the shift to low-cost, passive products.

Andy Friedman Predicts: Clinton, a Certain Candidate; Either Trump or Cruz in a Convention Showdown
In his extremely well received remarks, Andy Friedman, the political guru of The Washington Update, opened with his evaluation of the House and Senate races. The political redistricting in 2010 has made the Republicans winning the House a sure bet in 2016 and as well as in the following decade. With control of the House, Republicans can stop or start any piece of legislation they choose – not good news for Hilary Clinton, who will face the same legislative gridlock as President Obama if she is elected.

As for the Senate which the GOP took two years ago, it is likely that the Democrats in an ordinary election year would pick up enough seats to regain control. But the Presidential election could change that because Americans are more reluctant than ever to split tickets, and a candidate who really excites the electorate could pull in otherwise weak Senate candidates. Therefore, Mr. Friedman’s prediction is that whichever party wins the White House will take the Senate, as well.

The election outcome, he believes, will hinge on independent voters – people who typically are more worried about economic issues, jobs, government spending, and taxes. They are not worried about social issues like gay marriage or climate change, and they want to see compromise – they don’t want to see stalemating. The candidate whose profile comes closest to those values will get the independent vote. Similarly, a party that attracts minorities will have a significant advantage.

Looking at the candidates, Mr. Friedman said, “Donald Trump has shown me something new – you can insult your way to the Presidency. Who knew that? Why has he done so well? The reasons are threefold: Trump supporters are typically white, typically male, and typically not college educated. His supporters feel their lifestyle is under siege both economically and culturally. They feel disenfranchised.”

Who will the nominees be? “As I have been saying for two years, I think Hilary Clinton will get the nomination. There is no one who can stop her…My prediction is that you will see either Trump or Cruz as the Republican nominee. A white knight like Paul Ryan or Mitt Romney coming in is not going to happen. If Trump goes into the convention without 50% of the vote – and I don’t think he can get 50% – the convention will come down to a question of how far behind Ted Cruz is.”

Negatives for Mrs. Clinton in the general election: her embracing of the Obama administration and her greater than 50% negativity rating – more than 50% of those surveyed say they don’t like her. Normally that would knock a candidate out of the race, but Trump’s negativity rating is even higher – eight of 10 Hispanics have said they’d vote against him as well as 67% of women, including Republican women.

If you were able to join us, we hope you left the Convention feeling energized and invigorated. If you weren’t able to attend, please contact us with questions on any of the topics or resources discussed.

In either case, check the MMI calendar for upcoming events, including the DOL Fiduciary Rule Forum in New York City on May 25th.

The Annual Convention received significant coverage in the industry press. View a summary of Annual Convention-related articles.

2016 MMI Annual Convention: In the News

Nuveen’s Bob Doll: Consumer Stronger than You Think
Nuveen's Robert Doll gave a muted outlook for stocks at the Money Management Institute's conference in Washington, D.C. on Wednesday — but that still makes him more optimistic than most.
Apr. 20, 2016

MMI Tackles Industry Changes at Annual Conference
At the annual MMI conference, industry leaders discussed how advisors can navigate a rapidly shifting industry landscape...
Apr. 21, 2016
WealthManagement.com, Ryan W. Neal

Hillary Clinton Presidency Would Face Same Gridlock as Obama: Andy Friedman
Speaking at the Money Management Institute’s annual convention in Washington, Friedman of The Washington Update said that because the House will be controlled by Republicans for the next decade – and possibly beyond – a Hillary Clinton presidency will face the political gridlock that has plagued the Obama administration.
Apr. 21, 2016
ThinkAdvisor, Melanie Waddell

Merrill, Envestnet Detail Tips for Due Diligence Gauntlet
Asset managers working with distribution platform due diligence teams must focus on honesty, timeliness and understanding distributors’ needs in order to get a foot in the door, gatekeepers said during a Money Management Institute (MMI) panel this week.
Apr. 22, 2016
FundFire, Danielle Verbrigghe

Money Management Institute Announces Awards
The Money Management Institute…has announced the winners of its 2016 Industry Leadership Awards.
Apr. 22, 2016
BenefitsPRO, Marlene Y. Satter

Bob Doll: Don’t Worry About China; Worry About Corporate Taxes
Speaking at the Money Management Institute’s annual convention in Washington, Doll…pegged corporate tax reform as the “most important issue for the markets” after the presidential election, and laid out some other predictions for attendees.
Apr. 25, 2016
ThinkAdvisor, Melanie Waddell

From the C Suite with RBC's John Taft: It isn't enough just to get up and work
The great-grandson of President William Howard Taft shares what he's thinking about his post-RBC career — including whether he will step into politics
Apr. 25, 2016
InvestmentNews, Liz Skinner

Wealth, Asset Management Firms Start Making Lemonade out of DOL Lemons
Investment advisory program sponsors and asset managers are taking steps to mitigate risks, and take advantage of opportunities created by the Department of Labor’s fiduciary rule, executives said at the Money Management Institute (MMI)’s annual convention in Washington D.C. last week.
Apr. 28, 2016
FundFire, Danielle Verbrigghe

DOL Rule Effects Will be Felt Throughout Industry: Pershing
Speaking at the MMI annual convention, Rob Cirrotti, head of retirement and investment solutions for Pershing, explains how the DOL's new fiduciary rule may affect the managed account industry.
May 2, 2016
FundFire, Danielle Verbrigghe

Cease-fire by DOL Fiduciary Rule Opponents May Not Last Long
Industry generally has not barked about the final rule, but that doesn't mean that it won't eventually bite. “There's just a sense of relief relative to the proposed rule,” Craig Pfeiffer, president and chief executive of the Money Management Institute, told reporters at an MMI conference in Washington on April 21.
May 2, 2016
InvestmentNews, Mark Schoeff Jr.

DOL Rule Has Implications for Wholesalers, Fees: Pershing
Speaking at the MMI annual convention, Rob Cirrotti, head of retirement and investment solutions for Pershing, discusses what the DOL's fiduciary rule means for advisory program fees and wholesalers at asset management firms.
May 9, 2016
FundFire, Danielle Verbrigghe

MSWM’s Tracy Outlines SMA Product Needs
Speaking at the MMI annual convention, Jim Tracy, head of Morgan Stanley Wealth Management's Consulting Group, discusses separately managed account (SMA) product needs and industry trends.
May 26, 2016
FundFire, Danielle Verbrigghe

Read a quick recap of Annual Convention highlights that you can share with colleagues.

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