The SEC Outsourcing Rule: What Happens When Advisors Fail as Fiduciaries
The SEC recently proposed a new rule designed to ensure that advisors live up to their fiduciary duties when they outsource. The proposed rule is quite broad in scope. It covers not only outsourcing to TAMPs, but also outsourcing to a range of other service providers. The proposed rule requires ad
Our Greatest Gift to Our Clients
Ouzel Lake in the Wild Basin area of Rocky Mountain National Park is a peaceful place. Especially on an early Fall morning after the first snowfall. My wife and I reached it on an icy trail surrounded by waterfalls and beautiful views of the rugged mountains that define the edges of the Wild Basin.
Don’t Believe the Pundits—Small is Beautiful
Pundits keep predicting that big will “dominate” small in the financial advice space. I ain’t buyin’ it. The big wirehouses have been around forever and they have been losing ground not gaining it. Mark Hurley predicted decades ago that the independent advisory business would consolidate int
I returned to the scene of the crime last weekend–the Manitou Incline. The Manitou Incline is a beast. It’s a stairway that rises over 2,000 vertical feet straight up the side of a mountain in less than a mile. (It’s 1,454 feet to the top of the Empire State Building.) In September, I cl
The Relationship Between Direct Indexing and Active Management
Last month I described what direct indexing is and how advisors might use it to satisfy specific client needs. This month I want to briefly explore the differences between direct indexing and traditional active management. Is Direct Indexing Passive or Active Management? True index investing—or pa
Direct indexing portfolios are broadly diversified portfolios of individual stocks that are personalized to meet the needs, values, and preferences of an investor. An Index Oriented Approach As its name suggests, direct indexing takes an index-oriented approach to investing. The investor, in consult
Here They Come Again—The Soothsayers and Snake Oil Salesmen
Since the stock and bond markets started misbehaving at the beginning of the year, we have been assaulted pretty much non-stop by the usual crop of product-pushers, market timing advocates, and crystal ball gazers. Do yourself a favor and ignore them all. In 2006 Philip Tetlock published his 20-year
An Essential Road Map for TAMP Users
Selecting a turnkey asset management provider (TAMP) to manage your clients’ assets is an investment decision. Thus, it triggers your fiduciary responsibilities to your clients. The SEC made this clear in a Risk Alert issued July 21, 2021. The Commission also provided a roadmap for advisors to
Why Investing Based on Past Performance is a Terrible Idea
Both the SEC and FINRA require performance-based advertising and sales literature to include the statement: “past performance does not guarantee future results.” Is that good advice? Mutual Funds Research by S&P Dow Jones on the persistence of mutual fund performance shows why this warning m
In Volatile Markets, Patience Is Your Friend
The financial markets have been volatile since the beginning of the year. After three great years, the stock market has been down significantly in 2022. Interest rates have risen causing bond prices to fall too. That’s a double whammy we haven’t seen too often recently. In the face of this
Why is Active Management So Difficult?
You have to feel sorry for active managers. According to the year-end 2021 SPIVA Scorecard research from S&P Dow Jones, here is the percentage of actively managed US equity funds that underperformed the S&P 1500 Index over various time periods ending December 31, 2021. It paints a gri
What if You Let Your Clients Build Your Business?
You think you know what clients want, but do you really? We all shake our heads vigorously in agreement when someone says that to have a more successful business, you need to design an excellent “client experience.” We might not know exactly what that means, but with a little digging we learn th
Later this quarter (Q1 2022), First Ascent will be introducing a direct indexing offering to the advisors we work with. We call our new offering Customized Index Portfolios. Customized Index Portfolios hold individual stocks and can be designed to reflect the investment goals, values, and preference
The Glitter of Gold—Should Gold Be a Part of Your Portfolio?
Gold is beautiful to look at and has a rich history, but does it belong in your investment portfolio? The information below will help you answer that question. A Quick History Gold has been valued throughout most of recorded history. It was used to display wealth, power, and status over 5,000 years
What is Inflation? Inflation is a measure of how much prices for goods and services are rising in an economy. Inflation can be caused by a number of factors. Demand-pull inflation occurs when there is more demand for goods or services than the current supply can meet. This allows companies to raise
First Ascent maintains its brand identity and will operate as an independent subsidiary of GeoWealth
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