Products June 14, 2016

ERISApedia Debuts Data-Mining Tool

PDI aims to be a resource for analyzing Form 5500.
Reported by

Burrmont Compliance Labs LLC, parent company of ERISApedia.com, has launched a new data-mining tool, the Plan Data Intelligence ReSource (PDI).

PDI enables financial advisers to search Form 5500 data, along with the 5500 Schedule of Assets contained in the 5500 attachments, for specific assets or categories of assets. Through what Burrmont describes as “a revolutionary platform with a state-of-the-art user-friendly interface,” PDI also lets advisers customize their analyses based on location, plan or sponsor type, asset range, number of  participants, average participant account balance and other criteria. Plans may be located by way of financial filters, warning flags and other category types. 

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PDI joins ERISApedia.com’s other compliance and business development tools, which, says company founder Tim McCutcheon provide “robust searchable data at a reasonable cost.”

Besides PDI, which is directed at financial advisers, ERISApedia.com also offers the CPA Prospecting ReSource, aimed at CPA firms involved in auditing employee benefit plans.

The Markets June 14, 2016

Factors Converging to Drive Growth in ETF Use

Among other things, Greenwich Associates says liquidity needs of institutional investors will fuel demand for ETFs in fixed income, driving $68 billion in new annual flows.
Reported by

Institutional investments in exchange-traded funds (ETFs) are projected to grow to $300 billion annually by 2020, says a new report from Greenwich Associates.

According to the report, “Global Trends in Institutional ETF Adoption: Drivers for Growth Through 2020,” 2015 was a record-breaking year for ETFs as a category, which attracted more than $350 billion in new assets globally. Institutional investors are increasingly contributing to ETF demand, which has historically been driven by retail investors.

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An analysis of Greenwich’s research yielded five key drivers of institutional ETF adoption that the firm projects, together, will generate approximately $300 billion in annual investments by 2020:

  • The broadening use of ETFs across applications and asset classes will drive $132 billion in new annual demand in five years’ time;
  • The migration toward using ETFs to obtain core exposures and achieve strategic goals will produce $42 billion in annual flows;
  • Liquidity needs will fuel demand for ETFs in fixed income, driving $68 billion in new annual flows;
  • Institutions using ETFs to replace derivatives positions will produce $28 billion in flows annually; and
  • Innovative exposures such as smart-beta ETFs will attract $25 billion in annual flows.

According to Greenwich Associates, institutions that currently invest in ETFs allocate an average 15% of total assets to the funds, with allocations largest among Canadian and U.S. investors at approximately 20% of assets. The firm projects that ETF allocations will climb to 25% of total institutional assets in North America.

“While institutional equity portfolios will remain a major source of growth for some time to come, the intersection of an increasingly diverse slate of institutional needs and the inherent flexibility of the ETF structure will spur the spread of the funds into new areas and asset classes,” says Andrew McCollum, Greenwich Associates managing director and author of the report.

The report presents the results of a Greenwich Associates study for which the firm interviewed 408 institutional investors in North America, Europe and Asia, including corporate pensions, public pensions, foundations, endowments, asset managers, insurance companies, investment consultants and registered investment advisers (RIAs).

The report may be downloaded from here.

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