Change is in the Air!
John Meunier & Christy White
Cogent Principals
 This issue is dedicated to change, from our first story which covers investors' declining usage of mutual funds, to our second story which delves deeper into the drivers behind this change and questions the longevity of investors' current love affair with ETFs. Of course, we'd be remiss not to discuss all the changes right here at Cogent-our expanding team, our new Linkedin group, and our newest product Institutional Investor Brandscape™ covering the opinions of 590 investment professionals' opinions of leading asset managers.
As the year moves along, stay tuned for even more developments; more new products, deeper marketing insights, and further examples of the ground-breaking research you've come to expect from Cogent Research.
Let's get to it!
To learn more about all the new reports from Cogent Research this year, please click here.
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As an evidence-based consultancy, Cogent Research is dedicated to delivering clarity, perspective and direction to leading organizations in the wealth management industry. Through a unique blend of syndicated and custom research, industry expertise, advanced analytics, and strategic consulting, we are redefining the role and function of marketing research in the areas of product development, brand equity, client experience, and revenue enhancement.
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Mutual Fund Asset Allocation
Most of today's mutual fund investors are allocating their fund assets across a variety of asset classes. For the first time in our Investor Brandscape™ report series, we have asked mutual fund owners to indicate their usage and allocation across various asset classes. What follows is a summary of these initial findings.
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ETF Business Growth
When it comes to ETFs, both advised and self-directed investors are still finding their way with this relatively new investment vehicle. While the SPDR ETF came into existence in 1993, its growth as an investment vehicle has been quite measured. ETFs only recently passed the $1 Trillion milestone for assets under management (BlackRock, 12/18/10). By comparison, the modern Mutual Fund has been around since the 1920s and now has $11 Trillion of AUM (ICI website, 12/30/10).This size comparison helps us better understand why some views held by investors about ETFs might seem paradoxical or less-well formed.
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Reading List
Cogent Research Cited in John C. Bogle's book,
Don't Count On It
Click here for more information about Bogles' new book.
Performance Evaluations from a Higher Authority
"While the performance methodology I have chosen is inevitably imperfect, I believe that it is not only entirely reasonable, but a significant enhancement over most other methodologies. But, let's find out how the fund shareholders themselves regard the funds they actually own. Happily, thanks to a survey done in 2007 by Cogent Research LLC, we have measures of how fund shareholders feel about the mutual fund firms that manage their money. (The study focused on shareholders who have mutual fund investments of at least $100,000). The Cogent study, reported by the Wall Street Journal, measured client loyalty, presenting investors with a scale representing the extent of their trust in their managers-10 the highest rating ("definer investors), 1 the lowest ("definitely not recommended")."
Each firm was scored by subtracting the percentage of shareholders who rated the firms at 5 or below (“detractors”) from the percentage who rated the firms at 9 or 10 (“supporters”). Only 11 of the 38 firms evaluated had positive loyalty scores. The average score was -12, a message about investor confidence in the fund industry that would not seem to be much of a tribute.
Simply put, fund shareholders seem to “get it.” When we juxtapose these loyalty scores for each firm with its performance scores, we see a remarkable, if by no means exact correlation (Table 13.2).
This excerpt is reprinted with permission from John Wiley & Sons. Don't Count On It, John C. Bogle, 2011.
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New Hires
David Feltman
Managing Director, Syndicated Research
David Feltman is a marketing professional with more than 20 years of service in the corporate, public affairs and non-profit arenas. Most recently, David was a senior director with the marketing organization of iShares, the Exhange Traded Fund (ETF) business of Barclays Global Investors, now part of BlackRock. He joined iShares in 2000. During his long tenure with the iShares business, David had a range of responsibilities which at various times included market research, direct marketing to financial professionals, CRM, advertising in the online space and the introduction of iPath, the Exchange Traded Note (ETN) brand, a joint effort between Barclays Global Investors and Barclays Capital. He was responsible for developing marketing strategies for both the institutional and retail advisory channels within the programs he managed. David holds a B.A. in Political Science and Child Study from Tufts University and a Masters in International Relations from Johns Hopkins. In addition to his deep interest in finance and investing, David's passions include collecting ethnic & cultural art and world travel. He recently completed a 7 month round-the-world journey, which brings his total countries/territories visited to 100.
Mo Wang
Associate Product Manager
Mo Wang received her B.A. in Chinese Language &  Literature from Beijing Language and Culture University, Beijing, China in 2009. She continued her studies and in 2010, received her MA in Global Marketing Communications & Advertising from Emerson College, Boston, MA. While attending Emerson College, Mo was a Social Media Specialist for Spotlight Communications. She was responsible for executing viral marketing campaigns, exploring consumer insight on emerging media and assisting the Principal of the company in starting a "social media training" program for business professionals. She also interned at E&E Co. (JLA Home) as a Marketing Communications Intern. Mo was in charge of coordinating all aspects of a lifestyle branding project, including idea generation and brand attributes.
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Upcoming 2011:
Syndicated Discovery Reports
Advisor Rollover Assets in Motion ™ 2011
Retirement Planscape™- May 2011
Advisor Brandscape™- June 2011
In-Retirement Income™ - April 2011
Investor Rollover Assets in Motion™- April 2011
Emerging Investor Trends™ - March 2011
For a complete list of our 2011 product lineup, click here.
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