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Portfolio > Mutual Funds

Top Portfolio Products: Management Changes at Vanguard, Touchstone Funds

By Marlene Y. Satter

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New products and changes introduced over the last week include management changes at several Vanguard funds and at Touchstone’s Small Cap Value Fund; new ETFs from Global X, VanEck and FlexShares; and Schwab added participants to its OpenView Gateway.

Also, Folio Institutional added Morningstar models to its Model Manager Exchange;  ssetMark and Total Bank Solutions partnered to provide a customized insured cash deposit program for advisors; Marstone and Quovo partnered on data aggregation; and Advicent announced the latest release of its financial planning portal.

Here are the latest developments of interest to advisors:

1) Vanguard Changes Management Teams at Several Funds

Vanguard announced that MYG Investment Management Limited is no longer serving as an advisor to the $21 billion Vanguard International Growth Fund (VWIGX) and $2 billion Vanguard Variable Insurance Fund–International Portfolio. Baillie Gifford and Schroder Investment Management North America are now splitting management of the fund, 60/40.

In addition, Vanguard announced that David Palmer of Wellington Management Company is now the sole portfolio manager of its $1 billion Capital Value Fund (VCVLX). He had previously co-managed the fund with Peter Higgins.

2) Touchstone Names New Subadvisor for Small Cap Value Fund

Touchstone Advisors named Boston-based LMCG Investments, LLC as subadvisor to its Touchstone Small Cap Value Fund (TVOAX, TVOCX, TVOYX, TVOIX).

LMCG replaces DePrince Race & Zollo, Inc. as well as Russell Implementation Services, Inc. which served as interim subadvisor to manage the fund during the transition, from May 21 to June 30, 2016.

3) Global X Adds Conscious Companies ETF

Global X Funds launched the Global X Conscious Companies ETF (KRMA), which tracks a proprietary index created by Concinnity Advisors.

The index draws on numerous sources to identify companies that have demonstrated a long-term focus on creating positive outcomes for a variety of stakeholders, including employees, customers, communities, suppliers and stock and debtholders.

The fund’s holdings have undergone analysis to determine their adherence to the academically-backed Multi-stakeholder Operating System.  KRMA’s expense ratio is 0.43%.

4) VanEck Adds Emerging Markets Sovereign Bond ETF

VanEck launched the VanEck Vectors EM Investment Grade + BB Rated USD Sovereign Bond ETF (IGEM) which seeks to replicate as closely as possible the price and yield performance of the J.P. Morgan Custom EM Investment Grade Plus BB-Rated Sovereign USD Bond Index before fees and expenses. EM stands for emerging market and USD for U.S. dollar.

IGEM has a net expense ratio of 0.40%, which is capped until September 1, 2017.

5) FlexShares Adds Two Sustainable Investing ETFs

FlexShares launched the FlexShares STOXX Global ESG Impact Index Fund (ESGG ) and FlexShares STOXX US ESG Impact Index Fund (ESG).

ESGG includes those companies in the STOXX Global 1800 Index that score better on a small set of environment, social and governance (ESG) characteristics. The bottom 50% of scorers as well as companies that don’t adhere to the United Nations Global Compact (on human rights, labor, the environment and anti-corruption) or engage in businesses relating to controversial weapons or coal mining are excluded from the fund. Companies with higher relative ESG scores are more heavily weighted. The fund’s expense ratio is 0.42%.

ESG uses the same methodology as ESGG but includes only U.S. stocks, and its expense ratio is 0.32%.

6) Schwab Adds Participants to OpenView Gateway

Schwab Intelligent Technologies announced that portfolio rebalancing provider Morningstar Total Rebalance Expert (TRX) and client portal provider ModestSpark will participate in Schwab OpenView Gateway.

TRX provides automated, tax-efficient rebalancing; the integration will allow advisors to automatically submit trades to accounts custodied with Schwab.

ModestSpark offers a Web-based and mobile client portal with direct access to portfolio information and reports. This integration will allow advisors using PortfolioCenter Hosted or Portfolio Services to automatically update portfolio management data in the client portal.

7) Folio Institutional Adds Morningstar Models to Exchange

Folio Institutional added 31 Morningstar Managed Portfolios ETF and mutual fund models to its Model Manager Exchange (MMX), which is a network of third-party investment models for registered investment advisors.

The added Morningstar models include five mutual fund-based and five mutual fund-and-ETF-based asset allocation portfolios for tax-deferred accounts and five mutual fund-based and five mutual fund-and-ETF-based asset allocation portfolios for tax-sensitive accounts plus five ETF-based asset allocation portfolios; four retirement income portfolios; one absolute return portfolio; and one multi-asset high-income portfolio.

8) AssetMark Partners with Total Bank Solutions

AssetMark elected Total Bank Solutions to create an insured cash sweep solution on the AssetMark Trust Company platform. The Insured Cash Deposit program will debut in late September.

9) Marstone, Quovo Partner on Data Aggregation

Marstone announced that it will add Quovo’s data aggregation tool to its advisor-focused digital wealth solution. Quovo’s account aggregation technology syncs data from thousands of financial institutions ranging from retail brokerage and banks to custodians and mutual fund families for a current and holistic view of their clients’ portfolios.

10) Advicent Adds NaviPlan to Narrator Clients

Advicent announced that its newest financial planning portal, Narrator Clients, will be powered by NaviPlan as part of its latest version update.

Advisors can set up and manage their clients with a unique username and password within the Narrator Clients portal. By submitting delivered plans to the portal, the Narrator technology creates a richer digital planning experience that advisors can offer their clients. Clients can then analyze their results and develop questions for their advisors.

Read the July 11 Portfolio Products Roundup at ThinkAdvisor.

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