The Markets July 20, 2015

International Equity Tops Fund Flows in June

International equity offerings attracted nearly $25 million for the month.
Reported by

Net inflows to stock and bond mutual funds and exchange-traded products (ETPs) totaled $8.5 billion in June.  

Long-term mutual funds saw net outflows of $5.4 billion in aggregate during the month, while ETPs experienced roughly $14 billion of net deposits, according to Strategic Insight, an Asset International company.

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Investor demand in June was led by international equity offerings, which attracted nearly $25 billion of net inflows in total across funds and ETPs (including $8.7 billion to actively managed strategies). Longer-term, the $170 billion deposited to international equity funds and ETPs over the first half of 2015 represented the largest net inflows of any fund type by a wide margin, Strategic Insight said.

Within the U.S. equity space, health (including biotech) strategies once again led net inflows to actively managed funds during June, garnering $1.3 billion. Over the first half of 2015, such funds have attracted nearly $10 billion of net deposits (the largest of any active U.S. Equity objective)—spurred by the category’s 35% weighted-average total returns during the one-year period ended in June.

Bond funds saw $10.2 billion of net outflows in aggregate during June, with taxable bond offerings accounting for $8.6 billion of net redemptions (including roughly $10 billion from active strategies). Corporate high yield funds, in particular, experienced $7.7 billion of net outflows during the month. 

Data & Research July 20, 2015

Investors Say They are Partners with Their Financial Advisers

More than a third say their adviser’s recommendations have boosted their investments substantially.
Reported by

Nearly 70% of investors say they are partners with their financial advisers when making financial decisions, according to the second-quarter John Hancock Investor Sentiment Survey, a quarterly poll of affluent investors.

However, only a quarter accept their adviser’s recommendations. Among those who have listened to their adviser, 34% say the value of their investments has increased substantially due to their adviser’s recommendations.

The primary reason investors work with an adviser is to manage their investments, cited by 70%. Two-thirds have a financial adviser to develop a retirement plan, 50% to produce a comprehensive financial plan for major life events and goals, and 20% rely on their adviser to make recommendations in the event of death, disability, critical illness or other risks.

As to how they would like to interact with their adviser, 70% say face to face, with nearly as many indicating speaking over the telephone. Only 5% want to communicate with their adviser via text messages, 2% over video chat, and less than 0.5% through social media or podcasts. Asked how their association with their financial adviser could be improved, 30% say more in-person interaction and 20% say regular electronic updates about their account.

Greenwald & Associates conducted the survey for John Hancock among 1,064 investors from May 11 to May 22. To qualify, respondents had to participate in their household’s financial decision-making process, have a household income of at least $75,000 and assets of $100,000 or more.

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