Adviser Spotlight

After a long period of growth, both performance and assets have tailed off for real listed assets since 2016, raising the question of whether they’ve seen their best days for the time being. Recent analysis from our Manager Research Team reveals some significant shifts worth noting for clients with portfolio exposure to this sector.

Sustainable investing can offer tremendous opportunity for financial advisers and asset managers, alike. Interest in the field is significantly growing among investors – particularly investors who are young, female, or more affluent.

While well-intentioned, the industry’s current approach to matching investors to appropriate investments is incomplete. To help, Stephen Wendel, Head of Behavioural Science at Morningstar, outlines how you can better manage your risk-averse clients during times of market volatility.

Australia’s Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry serves as a stark reminder of the importance of stewardship in evaluating a managed investment product. See how we rate the “big 5’s” stewardship of their funds management business’.

Benchmarking is a concept used to help define whether an investment proposition is delivering value. It is well intentioned; however, we should acknowledge the shortcomings. In this article we discuss the importance of benchmarking to your financial goals.

Kate Howitt, portfolio manager at Fidelity International, and Vince Pezzullo, Perpetual’s deputy head of equities, discuss the expensiveness of the Australian market, potential value traps, and the difficulty in defensively positioning portfolios – outlining the case for active management in the current market environment.

ETFs are undoubtedly one of the fastest-growing sectors in financial markets today. To learn what’s really behind this trend, Morningstar’s Alex Prineas chaired a riveting Investment Conference panel with Jonathan Howie, head of ETF product and strategy for iShares, and Alex Vynokur, CEO of BetaShares, one of Australia’s fastest-growing ETF managers.

Learn how the Morningstar star ratings provide investors and advisers alike with a great starting point in their fund selection process.

Clint Abraham, Portfolio Specialist at Morningstar Investment Management, takes a look at the key lessons learned in the decade since the Global Financial Crisis.

Scenario analysis and stress testing are essential tools for managing long-term expectations and exploring shorter-term volatility. They can help tackle ‘what if’ scenarios that could derail a client’s plans. But what is the best approach to modelling future returns of your portfolios?

Opportunities often appear in markets. With sufficient scale and research resources, flexible mutli-asset funds should in theory be able to make the most of these opportunities by tactically tilting their portfolios at opportune moments.

We believe bond yields will eventually trend higher and revert to our estimate of fair value, but no one can predict the path or timing. The danger here is trying to time the market by exiting bonds in an attempt to re-enter when interest rates normalise. Find out how we’re currently thinking about bonds and positioning our portfolios accordingly.

The federal leadership spill in August has shortened the odds of Labor gaining office next year. And that prospect has sparked concern with Labor’s vow to axe cash refunds for excess franking credits. But what action, if any, should you take to prepare for the possible impact to your clients’ portfolios?

Strategic-beta fixed-income funds attempt to deliver better performance than traditional market-capitalisation-weighted index funds, or a specific outcome like a constant duration. These strategies often seem more intuitively appealing than the alternative of owning a broad market-cap weighted portfolio but there are 6 key factors that advisers need to consider before deciding whether to include these strategies into a client’s portfolio.

Many of your clients may be financially stable or very well-off but are still tormented by their finances. As advisers, how can you help these clients reduce their financial anxiety and even improve their financial well-being? To answer this question, we explored the power of social comparisons and identified a few ways that you can use this natural tendency to help clients.

Active ETFs are the latest phase of a passive revolution in the Australian investment market. Last year assets under management in Aussie-listed ETFs grew by more than 30 per cent; proving low cost options are gaining popularity fast. Australia’s ETF sector broke through the $40 billion barrier in August to reach another new record of $41.5 billion.

At the heart of the challenge facing the industry today is rebuilding trust. Trust is the foundation of every relationship. None more so than between financial adviser and client. And in the wake of  the Royal Commission’s Interim Report, Morningstar is playing a key role in helping the industry and advisers regain trust through full transparency.

Did you know 25 Australian ETFs have been terminated since 2013? That’s a big number and it means about 12% of Australia’s ETFs have shuttered in that time. In this article, we examine what a termination really means for investors and how to avoid getting caught by ‘Terminator’ ETFs.

It’s important to understand where your edge comes from. We believe ours is analytical, organisational, and behavioural – and this explains why we’re compelled to be defensive in the current market. And, by sticking to our strengths, we believe we will help end investors and those we serve in the long run.

Despite the pressures in the industry right now, we continue to believe in the future of financial planning. This is not just wishful thinking. For five years now, our most senior researchers in the US and Canada have been able to quantify the benefits of good advice – and they are significant.

On 24 May, the curtain was raised at the 2018 Morningstar Investment Conference with an enthralling keynote presentation from two of our industry’s deepest thinkers. Dr Michael Hasenstab and Kerr Neilson captivated the full house of advisers by outlining their predictions and positions for the years ahead.