Products October 6, 2010

Keep the Value-Add Programs Coming, Say Advisers

kasina and Horsesmouth found that advisers appreciate well-constructed value-added programs because they often lead to business growth.   
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A survey by the two companies also found that when a value-added program (meaning a series of information and tools that, when used correctly, grow an advisor’s book of business, educate the advisor in a meaningful way, or facilitate the adviser’s ability to meet specific client needs) helps an adviser gain or retain a client, the majority of advisers (63%) are more likely to keep the client’s assets with the company that provided the program.  

“The recent economic downturn and recovery has forced advisers to rethink not only the products that they invest in, but also their practice management,” says Steven Miyao, CEO at kasina. “Today more than ever, advisers are looking for product providers to help them with their businesses.”

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When looking for a value-added program to incorporate into a practice, kasina recommends that an adviser first figure out what sort of result are they looking for.   Whether it’s to grow a client base, educate the adviser on new trends, or facilitate the adviser’s ability to meet specific client needs, value-added programs are most effective when chosen to meet a specific need.  

The survey found the following value-added programs are the most highly recommended to advisers in these respective channels:

  • Traditional Wirehouse: BlackRock 
  • Regional Broker/Dealer: American Funds 
  • Independent Broker/Dealer: American Funds
  • Insurance Company: American Funds
  • Independent RIA: PIMCO
The Markets October 6, 2010

Vanguard Lowers Minimum Requirements for Admiral Shares

Vanguard says that by reducing the minimums for the ultra-low-cost Admiral Shares, nearly 2 million shareholders in 52 funds will benefit.
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Account balance minimums have been lowered for most retail clients to $10,000 (from $100,000) for Vanguard’s broad market stock and bond index funds, and to $50,000 (from $100,000) for most of Vanguard’s actively managed stock and bond funds.

The expense ratios for the Admiral Shares of Vanguard’s three broad market index funds – Total Stock Market, Total Bond Market, and Total International – range from 0.07% to 0.20%.  Vanguard says this allows investors to build a diversified portfolio covering the U.S. stock and bond markets, and the developed and emerging international stock markets, for less than comparable funds.

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Over the next several months, Vanguard will automatically convert qualifying accounts to Admiral Shares. Qualifying clients may convert sooner by visiting Vanguard.com or by calling 1-877-662-7447. Share conversions within the same fund are tax-free.

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