As defined contribution has become an increasingly large part of retirement business, Legg Mason has reached out to support advisers with investment products and tools. (see “Stylus Web Brings Plan-Level Reporting for Financial Advisers.”)
Stylus Web, MPI’s scalable Web-based fund manager research and reporting tool, allows Legg Mason to give its advisers access to plan analysis tools and reporting capabilities to better serve plan sponsor clients and display their fiduciary role, potentially winning new business.
The use of MPI’s Stylus Web can help both sides fill fiduciary roles by having a flexible investment scorecard (also known as an IPS or Investment Policy Statement monitor) to monitor and display how well investments are meeting objectives, Jeff Schwartz, managing director of MPI, told PLANADVISER.
As Schwartz pointed out, a plan sponsor’s fiduciary obligations include selecting managers that will allow their plan participants to create well-diversified portfolios based on Modern Portfolio Theory (MPT). One key part of choosing a manager is assessing style consistency and exposure, he said, “and these reports certainly address that need in a highly precise way.”
The reporting flexibility and precise investment analytics of Stylus Web help advisers construct better fund lineups, communicate investment dynamics and monitor funds for changes in style, risk and other red flags.
“Glide path analysis of target-date and target-risk funds is a current product development focus at MPI, and we hope to have a product announcement soon,” Schwartz said.
“The report (MPI Plan Analyzer) can show analytics on target-date funds, using the same metrics as standard funds, including all the risk analytics,” said Gary Kleinschmidt, head of retirement at Legg Mason.
The Plan Analyzer also includes data for exchange-traded funds, insurance group separate accounts, money market funds, variable annuities and stable value funds, among others.
MPI is a provider of tools that analyze investment performance and risk.
Legg Mason is a global asset management firm.