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Luminaries Awards

Practice Management > Building Your Business

Editor's Note: Best Active Managers of the Year

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We’re pleased to have worked with Envestnet on the Asset Manager of the Year Awards again this year. According to Tim Clift, chief investment strategist of Envestnet | PMC, Envestnet’s Portfolio Management Consultants group, these awards have evolved in tandem with the industry over the past 15 years.

“The awards recognize all the hard work that goes into active portfolio management,” he said. “And there’s a lot of hard work that goes into finding the best managers by our research team — identifying them, going on site visits, drilling them on what their best practices are and seeing that they actually do what they say they are going to do.”

The recognition of these top strategists, Clift points out, is extremely valuable as active management has become a tough field thanks to the huge growth in passive investing. “Seeing these active managers — who [work hard] for the fees that they charge, outperform and really do what they promise to do — is very exciting,” he explained. “I love giving out these awards.”

The nine Asset Manager Award winners of 2019 are featured in the cover story “Rising Above the Market’s Ups and Down,” which also shares the stories of Essential Advisor Award winners. This program recognizes professionals who embody values detailed in the book “The Essential Advisor,” co-authored by Envestnet President Bill Crager.

Our other “big” coverage this month concerns Regulation Best Interest, the Securities and Exchange Commission’s just-approved advice-standards package, which includes a new customer relationship summary and a new interpretation of “solely incidental” advice. A complete timeline of how this package came to be is found in Melanie Waddell’s Washington Watch, while analysis of the latest regulatory regime is highlighted in her Playing Field column.

Reg BI is “a mixed bag,” according to Barbara Roper, director of investor protection for the Consumer Federation of America. The SEC, “Made some tweaks to the rule that move it in the right direction — in particular by including the prohibition on placing the broker’s interest ahead of the customer’s interest in the rule’s compliance safe harbor — but that’s more than outweighed by their weakening of the conflict provisions, where conflicts now only have to be mitigated at the individual level, and firm-level conflicts are addressed exclusively through disclosure.”

In our survey of independent broker-dealer presidents earlier this year, more than two-thirds, or 68%, said the new regulations will cause confusion and challenges. The remaining 32% of execs were evenly split between those who are unsure about Reg BI’s consequences and those who do not believe confusion and other challenges will result.

When asked about the financial impact of new compliance procedures tied to Reg BI, just 27% viewed the expected shock to be minor; another 27% were unsure about the level of impact; and close to half, 46%, said the impact on their costs and business activities would not be minor.

As Mark Tibergien, CEO of BNY Mellon’s Pershing Advisor Solutions, explains in his Formulas for Success column this month: “No one ever said that building an advisory firm would be easy. After decades of toil, our industry has evolved. … The ongoing success of an advisory firm hinges on the leader’s ability to adapt to changing circumstances.”

Incoming Pershing CEO Jim Crowley recently told the 2,000-plus crowd assembled at its yearly Insite conference in Phoenix, that “the drumbeat is on … to do more and to do it faster. You should invest your capital in what makes your business more valuable and let us do the heavy lifting behind the scenes.”

In other words, take full advantage of your partnerships to keep up with the changing times. This is something we are more than glad to help you do — both in print and online at — through our relationships with industry leaders like Envestnet, Pershing and other organizations.


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