Displaying items by tag: advisors

(New York)

Merrill Lynch took a big step yesterday. Seemingly espousing the same view as Jamie Dimon, the firm officially blocked clients and all advisors who act on their behalf from trading Bitcoin. The firm does not believe in the asset class’ investment suitability. The ban extends beyond direct purchases of the cryptocurrency and extends to all futures and funds that trade in bitcoin. Advisors reportedly have mixed feelings on the move, with some saying it is a missed opportunity.

FINSUM: In our opinion, Bitcoin is a solid idea and is here to stay, but it just has so much regulatory risk right now that we think only accredited investors should be allowed to have it in their portfolios.

(New York)

The fiduciary rule is in an odd sort of limbo. Despite being seemingly dead from a rule-making point-of-view, it is still very much alive as a practical rule that needs to be abided by even if it is not in full force. But is still surprising to learn, especially given all the hype over the rule’s possible dissolution, that 42% of all advisor-held US assets under management are now subject to the fiduciary rule. That figure is up from what would have been 24% in 2005 and 33% in 2010. The growth has come from the large number of firms seeking to grow their fee-based managed account programs.

FINSUM: That is a quite a high proportion of assets. We hope the DOL rule will not be implemented and the SEC will come up with a more effectual version.