Mood of the month

Fairly optimistic
The European fund buyer’s mood index after having dropped on 60.8 points (in July was navigating on 62.1 points) in August lightly rebounded reaching 61.8 points in September. The general downtrend kept being driven by UK, Sweden, Switzerland and Belgium where less of 40% of the interviewed fund selectors declared to be optimistic over the next 12 months. On the other hand Spain and Germany managed to offset the general negative mood with over 65% of optimistic and very optimistic fund buyers in September.

Distributor commentary

For the week ending 2th February 2018
  • “I have noticed an increased availability of alternative-investment funds. I'm also noticing that asset managers are launching an increasing number of funds that use strategies which differentiate them from the typical equity and fixed-income strategies that we have been used to seeing up to now. So overall, I've noticed an increase in the number of absolute-return products and of funds with market-decorrelated strategies.”

    Innovative behaviour in fund industry
    Spain, Independent financial advice / Intermediary services
  • “There is a vast amount of cash invested on the fixed-income side and, at the same, time sectors such as the money-market sphere and government debt no longer make sense from an investment point of view. Hence, we are going to have to find alternative solutions to those types of investments and they'll need to be conservative ones, because we cannot shift bond-fund investors into equity-focused products. For that reason, I think that for the next few years the focus is going to be on conservative, multi-asset products.”

    Drives of Changes
    Italy, Funds of Funds
  • “I've noticed that asset managers are making an effort to do something about the low returns in fixed-income products. They are bringing out more-sophisticated types of products, including hybrid-bonds-focused portfolios, for example. In addition, they are lowering the commissions charged in some products.”

    Innovative behaviour in fund industry
    Spain, Funds of funds management
  • “I would like to see an even greater number of product innovations among alternative products. Risk should be spread more widely than in the past which would allow more room for manoeuvre, once interest rates are rising again. This would hand some opportunities to the active management which could still be more innovative when it comes to the product development. Of course, this depends on the management expertise of the provider if they can successfully cover such innovative strategies. Lastly, it’s got to be said that you can have the most innovative of products which might not resonate with the customer in the end.”

    Product innovation requirements
    Switzerland, Responsible for Product Strategy
  • “The most important drivers for change in the fund industry will be the models and algorithms used for the Robo-advice – as alternatives to traditional index funds. This could become an exciting topic. And they could withstand the increased cost awareness of the investors. These would open up new opportunities for the active management sector at reduced costs. The importance of active providers in the fund industry could increase again compared to passive investments.”

    Drivers of change
    Germany, Insurance - including unit-linked products
  • “I would also like to have a greater availability of flexible-managed and absolute-return products, and for these types of products to be easier for analysts and advisers to understand and explain, and of course, easier to explain to end-investors. I'd like to have greater transparency in this type of product and in alternative-investment products in general. I think that the fund industry could give independent advisers more support in relation to such products. What I mean is that it requires us to comply with certain rules, without giving us any type of 'leg-up' that would make our life easier - such as, for example, allowing us to make use of agents. That's something we are not permitted to do.”

    Product innovation requirements
    Spain, Independent financial advice / Intermediary service

Marketing matters

11 January 2018
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By Fiona Maciver

As the demand for greater transparency has intensified across the fund industry, the role of marketing has become more pivotal to asset managers’ distribution success. Several providers have struck a chord with fund buyers when it comes to marketing and communications competencies, understanding what matters most to distributors, including the growing requirement for a more personalised approach.

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