Products September 29, 2016

Investment Products and Services Launches

Jackson Square Partners offers mutual funds for institutional investors, Russell and Envestnet partner on new QDIA offering, and more.
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Conning Launches New Suite of Risk Management Software

Conning, a global investment management firm and financial-risk modeling software company, has released Version 6.6 of its suite of risk management software products. The offering includes the ADVISE Enterprise Risk Modeler, FIRM Portfolio Analyzer, and GEMS Economic Scenario Generator (ESG).

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Version 6.6 includes a new model of sovereign contagion risk, meaning that the propagation of crises between different bond issuers is realistically reflected in the ESG, the firm explains. The new version also expands on Conning’s “User Views” functionality with additional models and capabilities being added to the Real-World Recalibration Tool. The new suite also sees the introduction of calibration for corporate credit spreads by rating class, municipal bond spreads and sovereign yields with credit risk, as well as functionality for directly setting the correlation between some key variables. Clients will continue to have the capability to calibrate to tenor-specific targets and a wide choice of levels, moments, and statistics across multiple time horizons.

“The need for risk managers to confidently and reliably calibrate our software’s increasingly sophisticated economic models has been broadening and shows no sign of easing up,” says Dr. Hal Pedersen, a director of Risk Solutions for Conning. “With insurers coping with risks that we have not seen before, the release of Version 6.6 addresses a critical area of risk management modeling.”

All of the new features in Version 6.6 are accessible in an automated setting via the Conning command-line interface.

“We always view modelling, and calibration in particular, through the prism of automation, and look to advance on these fronts simultaneously,” says Dan MacKenzie, managing director of Software Product Management for Conning. “Risk management modeling continues to grow in both in scope and frequency, making it increasingly important to have applications that can be updated and processed reliably and efficiently.”

For more information about Conning’s suite of risk management software products, visit its website here.

NEXT: Advisor Partners Releases Global High Quality Dividend Yield Strategy

Advisor Partners Releases Global High Quality Dividend Yield Strategy
 
Advisor Partners has launched a new investment strategy. The Global High Quality Dividend Yield (GHQDY) is a diversified, risk-controlled strategy designed to target a yield premium of 75 to 100 basis points relative to yields on diversified global equity indices.

"In a world awash with negative yields, many advisers asked us to develop a global equity strategy designed to deliver solid, current income that also has a high probability of retaining purchasing power over time," says CEO Vikas Oswal. "GHQDY is our solution for a risk controlled global dividend strategy."

The GHQDY strategy will be offered with optional (opportunistic) tax-loss harvesting, Advisor Partners says. The strategy aims at portfolios that are diversified across developed markets and across GICS sectors. Currently, yields on global equity indices are approximately 50 basis points higher than on corresponding U.S. indices, the firm says. 

"This is yet another example of AP designing customized solutions that address advisers' requests for portfolios that will enable them to achieve the best possible outcomes for their investor clients," says Oswal.

Founded in 2001, Advisor Partners is an investment management firm providing investment solutions to financial advisers, family offices and financial institutions. 

NEXT: Jackson Square Partners Offering Mutual Funds

Jackson Square Partners Offering Mutual Funds
 
Jackson Square Partners now will offer mutual funds with a focus on institutional investors. The Jackson Square Partners Funds include Jackson Square Large-Cap Growth, Global Growth, SMID-Cap Growth, Select 20 Growth and All-Cap Growth funds. 

“The vast majority of our clients are institutions and these funds provide institutional clients and intermediaries with more flexibility and a broader menu of options to access Jackson Square’s strategies,” explains chief investment officer Jeff Van Harte. “The Funds’ daily net asset value and lower investment minimums than a traditional separate account make the strategies accessible to a wider range of institutional clients.”    

These funds have been launched in collaboration with Delaware Investments, which has reorganized three of its funds previously sub-advised by Jackson Square. As a result, certain shares of Jackson Square Large-Cap Growth, Focus SMID-Cap Growth and Select 20 Funds have track records more than a decade long and $350 million in combined assets, the firm says.  

The funds are available in a Series Trust structure and much of their administrative support has been outsourced to U.S. Bancorp Fund Services with Jackson Square maintaining core relationship management responsibilities, the firm says. Jackson Square anticipates that the funds may be available on major brokerage platforms such as Fidelity, Pershing and Schwab.

The following funds and share classes are effective as of September 19, 2016.

Jackson Square Large-Cap Growth Fund:

  • Class Investor (JSPJX)
  • Class Institutional (JSPIX)
  • Class IS (DPLGX)

Jackson Square Global Growth Fund

  • Class Institutional (JSPTX)
  • Class IS (JSPUX)

Jackson Square SMID-Cap Growth Fund

  • Class Investor (JSMVX)
  • Class Institutional (JSMTX)
  • Class IS (DCGTX)

Jackson Square Select 20 Fund Class

  • Class IS (DPCEX)

Jackson Square All-Cap Growth Fund:

  • Class IS (JSSSX)

Jackson Square is an independent, privately-owned investment manager specializing in long-only, growth-oriented public equity strategies and managing approximately $23.1 billion in discretionary assets under management as of June 30, 2016. 

To learn more about The Jackson Square Partners Funds, click here.

NEXT: Russel Investments Releases New QDIA

Russel Investments Releases New QDIA

Russell Investments and Envestnet Retirement Solutions have announced their plans to distribute a new qualified default investment alternative (QDIA) option for defined contribution (DC) plan participants.

The “managed QDIA” will automatically create a customized asset allocation for each participant by drawing on personal information from a recordkeeper or HR system. Participants will be able to further customize their personal “glide path” by entering preferences online. Plan sponsors and advisers will be able to incorporate this solution into their DC plans in the first half of 2017.

Powered by the ERS QuILTS patented participant advice engine, the plan aims to develop customized solutions for DC plans and individual participants. It is designed to be cost-efficient and easy to use like traditional target-date funds, the company says.

The solution automatically captures a participant’s personal information from a DC plan sponsor’s recordkeeper and human resources system without requiring a participant’s direct involvement or feedback. Personal information—age, gender, salary, current account holdings and contribution rate—is combined with Russell Investments’ asset allocation model to construct a portfolio customized to each individual participant.

The solution is designed to provide plan sponsors co-fiduciary support through Russell Investments’ asset allocation model advice and an adviser’s guidance regarding plan investments.

“Individual differences in participants’ savings and market experiences can have a meaningful impact on targeted retirement income replacement goals. This offers an alternative to target-date funds that focuses primarily on one simple data point—a participant’s age,” says Andrew Scherer, director of defined contribution at Russell Investments. “We believe this solution can help empower the adviser and the consultant to fulfill their fiduciary duties in areas such as plan design and investment selection. It provides a strong managed QDIA option that addresses the industry’s heightened focus on ensuring fiduciary standards are met.”

NEXT: Polen Capital Management to Advise Trust Funds

Polen Capital Management to Advise Trust Funds
 
Polen Capital Management, a global equity management boutique, announced that it will act as adviser to the Polen Global Growth Collective Investment Trust and the Polen Focus Growth Collective Investment Trust funds. Both are established by SEI Trust Company.

The new Polen Global Growth and Polen Focus Growth CITs will consist of large cap equity securities invested with Polen Capital’s investment philosophy and process, which has a 27-year track record.

“We have seen a growing client interest for our investment strategies within a CIT vehicle—particularly in our Global Growth strategy,” says Stan C. Moss, CEO of Polen Capital. “Similar to our investment philosophy of only investing in high-quality companies, from a business perspective we only partner with best of breed service providers. With SEI we found an industry-leading trustee and administrative services provider.”

Aiming to increase its retirement market presence and respond to clients’ needs, the Polen Capital CITs are the first CIT funds the firm advises.

“Polen Capital’s expertise with its Global Growth and Focus Growth strategies coupled with SEI’s scalable, flexible infrastructure is an appealing combination for retirement investors,” says John Alshefski, senior vice president and managing director of SEI’s Investment Manager Services division. “SEI’s integrated capabilities in CITs helps enable investment managers to preserve and grow assets.”

SEI is a global provider of investment processing, investment management, and investment operations solutions.

Benefits September 29, 2016

Fidelity Finds Individuals Have Unique Financial Wellness Needs

Emergency savings, budgeting and prioritizing goals are concerns all plan sponsors should address in their financial wellness programs.
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An analysis of individuals participating in Fidelity’s financial wellness program finds there are definitely some groups that have unique needs, and suggests ways plan sponsors can tailor their programs to address these concerns.

Meghan Murphy, director of thought leadership at Fidelity in Boston, tells PLANSPONSOR approximately 270,000 individuals have completed Fidelity’s financial wellness checkup, which shows “they want to tell their situation and get ideas for next steps.”

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Overall, most people (88%) are not confident about their financial future. More than half do not have healthy saving and spending habits or behaviors, and only about one-third (38%) have more than three months’ salary in an emergency fund. The top three topics that they are interested in: health savings accounts (HSAs), simple rules for saving and spending and saving for an emergency fund.

One group Fidelity pulled a snapshot of is what it calls “Unconfident Millennials.” Most of these individuals (89%) don’t feel confident or are wary of their current financial picture. About one-quarter (22%) are do-it-yourselfers, but they admit that they’re not confident in their investing and managing skills. Despite having the longest time horizon, more than one-quarter (28%) don’t invest in the markets.

Murphy adds that most Millenials said they are either stressed financially or just ok. Forty-two percent have little or no emergency savings. “Emergency savings is something on which plan sponsors can focus,” she says. “If individuals don’t have that, credit card debt increases, they are less likely to save and financial confidence decreases.”

NEXT: Helping single moms and Gen X

Fidelity also found single moms are in need of the most help. Most (97%) do not feel confident about their financial situation. More than half (60%) have little or no emergency savings, and 67% have credit card debt. About one-quarter (27%) spend more than they earn, while half (49%) break even each month.

“Single moms have so many competing financial priorities—their child’s next field trip or a sport their child wants to play,” Murphy notes. “Seventy-six percent said they are either living paycheck to paycheck or spending more than they earn.”

She adds that women in general tend not to talk about money, so employers need to get them engaged and talking about a strategy. “Budgeting is a key pillar of a financial wellness program,” Murphy says. “Fidelity has a rule of thumb: Spend 50% of pay on essentials, 15% for retirement—or at least work toward that, then save 5% for short-term expenses.

In its analysis, Fidelity also noticed a group it calls “Vacation Dreamers.” “Regardless of confidence, income, age or savings goals, everyone wants to get away,” Murphy says. This was especially true for Generation X individuals; they have a lot of competing financial priorities, but 48% said their top savings goal is for a vacation. However, 30% of Gen X have education debt, 54% have a mortgage, and they also have credit card debt.

Fidelity found having multiple savings goals decreased financial confidence. A financial wellness program can help individuals put a plan in place, perhaps to save in different investment vehicles “where the money is not easily accessible,” Murphy says. Or, having too many savings goals may not be best. “Prioritizing which are short-term and which are long-term may help,” she adds.

Murphy notes that other Fidelity research has found that people who have the ability to save even a little are much more financially confident. Individuals should be encouraged to save enough in their retirement plans to get the company match.

However, the goal of a financial wellness program expands beyond just savings, and should not all be focused on retirement. “Financial wellness is about so much more than retirement,” Murphy concludes.

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