There’s a surprising hurdle for advisors to overcome when dealing with ETFs – it’s advisors themselves
There’s a surprising hurdle for advisors to overcome when dealing with ETFs – it’s advisors themselves.
A new survey of affluent investors has found that while many investors are interested in ETFs, advisors haven’t taken the opportunity to educate their clients possibly leaving sales on the table.
"ETFs, particularly strategic beta ETFs, have become more widely accepted in recent years, yet our research reveals an opportunity for advisors to better educate investors about their benefits," noted Karen McCafferty, head of marketing for John Hancock Investments.
John Hancock’s online survey involved 1,000 U.S. investors with a household income of $100,000 or more and investable assets of at least $250,000.
Advisors take note.
While 71% of the respondents said they would consider adding ETFs to their portfolio and 51% of investors were interested in speaking with a financial advisor about them, only 31% had any significant familiarity with ETFs.
Just as troubling is the fact that more than half those surveyed indicated they primarily rely on a financial advisor for advice but often they’re the ones who’ve had to initiate a conversation about ETFs.
Advisors are clearly dropping the ball. Or are they?
The Wall Street Journal recently discussed their popularity indicating that the a study by the Financial Planning Association and Journal of Financial Planning found that ETFs have become the go-to investment vehicle of financial advisors with more than 80% using and recommending them for clients. No other products including mutual funds have the same usage statistics.
Clearly these two studies don’t jive.
Here in Canada the most recent figures suggest things are going very well for ETFs and advisors that sell them. As we enter the final quarter of the year ETFs in Canada have $84 billion in AUM, 10% higher than at the end of 2014. Equity and fixed income ETF inflows have totaled $4.5 billion and $4.7 billion respectively so far in 2015.
Whether you choose to believe the findings of the survey or not, it’s important that you don’t leave money on the table by not having a conversation about ETFs.
“ETFs have been able to maintain their popularity and continue to be useful through changing market conditions,” says Rajiv Silgardo, co-CEO of BMO Global Asset Management.
Your clients are waiting to hear this.
A new survey of affluent investors has found that while many investors are interested in ETFs, advisors haven’t taken the opportunity to educate their clients possibly leaving sales on the table.
"ETFs, particularly strategic beta ETFs, have become more widely accepted in recent years, yet our research reveals an opportunity for advisors to better educate investors about their benefits," noted Karen McCafferty, head of marketing for John Hancock Investments.
John Hancock’s online survey involved 1,000 U.S. investors with a household income of $100,000 or more and investable assets of at least $250,000.
Advisors take note.
While 71% of the respondents said they would consider adding ETFs to their portfolio and 51% of investors were interested in speaking with a financial advisor about them, only 31% had any significant familiarity with ETFs.
Just as troubling is the fact that more than half those surveyed indicated they primarily rely on a financial advisor for advice but often they’re the ones who’ve had to initiate a conversation about ETFs.
Advisors are clearly dropping the ball. Or are they?
The Wall Street Journal recently discussed their popularity indicating that the a study by the Financial Planning Association and Journal of Financial Planning found that ETFs have become the go-to investment vehicle of financial advisors with more than 80% using and recommending them for clients. No other products including mutual funds have the same usage statistics.
Clearly these two studies don’t jive.
Here in Canada the most recent figures suggest things are going very well for ETFs and advisors that sell them. As we enter the final quarter of the year ETFs in Canada have $84 billion in AUM, 10% higher than at the end of 2014. Equity and fixed income ETF inflows have totaled $4.5 billion and $4.7 billion respectively so far in 2015.
Whether you choose to believe the findings of the survey or not, it’s important that you don’t leave money on the table by not having a conversation about ETFs.
“ETFs have been able to maintain their popularity and continue to be useful through changing market conditions,” says Rajiv Silgardo, co-CEO of BMO Global Asset Management.
Your clients are waiting to hear this.
