Products September 15, 2010

TD Ameritrade Creates New Platform for UMAs

The Unified Managed Account Exchange, UMAX, will provide independent registered investment advisers (RIAs) with more flexibility and allow them to expand investment options for clients.
Reported by

With UMAX, Ameritrade is upgrading its unified managed accounts (UMAs) by giving RIAs two choices: 1) an open architecture approach in which advisers can build solutions from a larger selection of products using their own research and product selection strategy or 2) a bundled option that includes product research and asset allocation guidance. 

“Advisers working with UMAs have been limited by rigidity and lack of investment options,” said Matt Judge, director of product management, TD AMERITRADE Institutional, in a press release.  “With its open architecture and comprehensive product access, UMAX aims to provide advisers with the added flexibility and investment choice to help them respond to today’s volatile markets.” 

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With the open architecture option, advisers can offer clients a range of investment options, including Separately Managed Account (SMA) strategies, mutual funds, exchange-traded Funds (ETFs), exchange-traded notes (ETNs), closed end funds, third party strategists, and alternative asset classes.   

The Markets September 15, 2010

Equity to Fixed Income 401(k) Asset March Continued in August

 

The relentless march of 401(k) assets out of equities into fixed income continued unabated in August, according to the latest results of the Hewitt 401(k) Index.

Reported by

A Hewitt news release said a total of $347 million made the equities to fixed income trip during the month, representing 0.31% of total assets, with asset flows being fixed-income oriented on 16 of the August trading days.

Hewitt said the volume of August transfers were consistent with previous months. In total, 0.034% of assets were moved on a net daily basis, which was in line with the trailing 12-month average. Only one day in August had an above-normal level of transfer activity.

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Meanwhile, according to Hewitt, the three fixed income asset classes received nearly 100% of the August net inflows with Bond funds enjoying a $299-million net inflow, representing 80% of total transfers. GIC/stable value and money market funds experienced much smaller inflows than bond funds, with $39 million and $28 million shifting in these asset classes, respectively.

On the equity side, the picture was not pretty in August with all equity asset classes suffering net outflows. Large U.S. equity funds had the biggest asset losses, with $195 million moving out of these funds, while small U.S. equities lost $73 million in transfers, and international funds had $26 million in outflows.

Lifestyle funds also experienced net outflows, losing $29 million.

 

(Cont...)

Equity Holdings Decline  

Due to both fixed income-oriented transfer activity and market decline, participants' overall allocation to equity investments dropped significantly to 56.4% by the end of August, from 57.3% at the end of July.

Equity investment, on average, declined below the 60% mark (59.9%) for the first time since January 2010 in terms of 401(k) participants' discretionary contributions, which is a good gauge of sentiment and is not impacted by market movement, Hewitt said.

In terms of the major indexes, during the month the Dow finished with a -3.91% return, the Russell 2000 gave back 7.4%, the S&P 500 gave up 4.51%, NASDAQ  lost 6.24% and the MSCI EAFE lost 3.1%. The Barclays Capital Aggregate Bond Index showed a 1.29% advance.

The August index report is here.

The August showing follows a July performance in which approximately $449 million (or 0.42% of total assets) moved from equities to fixed income investments, with the majority coming out of company stock funds (see Participant Transfers in July Remain Fixed Income Oriented).

 

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