LAKE SUCCESS, N.Y.,
July 28, 2016 /PRNewswire/
-- Independent broker dealers (IBDs) and wirehouse firms
experienced net asset outflows of two percent for actively managed
mutual funds in the first half of 2016, according to data released
today by Broadridge Financial Solutions, Inc. (NYSE:BR) via its
Fund Distribution Intelligence. Much of the outflows of actively
managed funds from broker dealers appeared to move to passively
managed mutual funds and ETFs. During the first half of 2016, net
new assets for passively managed funds and ETFs increased by nine
percent and one percent for IBDs and wirehouses, respectively.
"During the first half of 2016, net new assets for passively
managed mutual funds increased by $37
billion, or 14 percent, for the retail distribution
channels, while actively managed funds were down by $24 billion, or 0.6 percent," said Frank Polefrone, senior vice president of
Broadridge's data and analytics business. "With pending regulatory
changes related to appropriate share class usage and the Department
of Labor's new fiduciary rule, we expect the growing use of
passively managed funds by advisors, along with the increasing
popularity of ETFs to continue to accelerate."
The bulk of the $35 billion of net
outflows from actively managed mutual fund accounts held at IBDs
moved to ETFs, which recorded an increase of net new assets of
$34.9 billion. The shift to passive
ETF products by IBDs increased the overall share of passive
products from 19.5 percent at the end of 2015 to 21 percent of
total fund and ETF assets managed by IBDs. The wirehouse channel
experienced net outflows of $21
billion from actively managed funds, but only increased
assets of passively managed funds and ETFs by $5.2 billion. As a result, wirehouses
experienced net outflows of long-term funds and ETFs of
$13 billion in the first half of
2016, and lost overall market share to other retail channels.
The shift from active management to passive products for other
retail channels was not as pronounced during the first half of
2016, primarily because these channels already have a larger
portion of fund and ETF assets invested in passive products.
The registered investment advisor (RIA) channel, which has 33
percent of its assets in passively managed products experienced
virtually no change in total mutual fund assets in the first half
of 2016, while ETF net new assets increased by 2.4 percent during
the same period. The discount channel, which is dominated by
Vanguard and Schwab discount brokerage operations, was up
significantly in both net mutual fund and ETF assets. The channel
has 55 percent of assets held in passively managed funds and
ETFs.
In the first half of 2016, overall net new assets for ETFs
increased by 1.2 percent to $2.2
trillion. Of the $24.8 billion
of net new assets, $22.5 billion, or
91 percent of the increase, came from passively managed ETFs.
Net new flows for long-term mutual funds showed a similar pattern,
with net new assets also increasing by 1.2 percent to $7.4 trillion of assets from third party
financial intermediaries. Of the $84.7
billion of net new long-term mutual fund assets,
$30.6 billion, or 36 percent of the
increase, came from passively managed mutual funds.
Additional key findings include:
- Net new assets of ETFs for retail channels – RIA, IBD,
wirehouse and discount B/D – were up by $61.3 billion in the second quarter, while net
new assets for institutional channels – private bank, bank and
trust – were down by $30.4
billion.
- Net new assets for retail long-term funds were up by
$12.8 billion, while institutional
long-term fund net flows increased by $71.7
billion.
- Net new assets of passive products for the retail channels
increased across major US product categories - US large cap (+13
percent), US mid cap (+11.6 percent), and US fixed income (+20
percent).
- Net new assets of active products for the retail channels
decreased for US large cap (-2.7 percent), US mid cap (-6.7
percent), US small cap (-0.4 percent) and increased for US fixed
income (+5.7 percent), high yield income (+4.8 percent) and US
municipal (+11.7 percent).
Broadridge's Fund Distribution Intelligence comprises the most
complete sales and asset data collection in the industry, creating
transparency into more than $9
trillion of long-term mutual fund and ETF assets across a
majority of mutual fund distributors.
About Broadridge
Broadridge Financial Solutions, Inc. (NYSE:BR) is the leading
provider of investor communications and technology-driven solutions
for broker-dealers, banks, mutual funds and corporate issuers
globally. Broadridge's investor communications, securities
processing and managed services solutions help clients reduce their
capital investments in operations infrastructure, allowing them to
increase their focus on core business activities. With over
50 years of experience, Broadridge's infrastructure underpins proxy
voting services for over 90 percent of public companies and mutual
funds in North America, and
processes on average $5 trillion in
fixed income and equity trades per day. Broadridge employs
more than 9,000 full-time associates in 14 countries.
For more information about Broadridge, please visit
www.broadridge.com.
Media
Contacts:
|
|
|
|
Linda
Namias
|
Maggie
Nolan
|
Broadridge Financial
Solutions
|
Brainerd
Communicators, Inc.
|
+1
631-254-7711
|
+1
212-986-6667
|
linda.namias@broadridge.com
|
nolan@braincomm.com
|
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SOURCE Broadridge Financial Solutions, Inc.