Linda York

About Linda York

Linda York is a senior vice president in the Syndicated Research division where she leads the Wealth Management Syndicated Research & Consulting practice. She has over 20 years of experience in financial services spanning responsibilities in finance, marketing and business strategy. Before joining Market Strategies, Linda was the practice director of Syndicated Research at Cogent Research, where she managed the product development and execution process for syndicated research projects and consulted with dozens of clients in the retail and institutional wealth management space. She earned an MBA in marketing from the University of Connecticut and a bachelor’s degree in mathematics from Mount Holyoke College. Linda is an avid equestrian and a two-time finisher of the Boston Marathon.

Satisfaction With Institutional Asset Managers Has Taken a Hit

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Satisfaction with Institutional Asset Managers Has Taken A Hit | Cogent Reports

It’s no secret that 2017 closed with a period of remarkable and sustained market expansion. Capping a year that featured strong economic growth, an improving job outlook and bolstered consumer confidence, the Dow Jones Industrial Average index hit record high after record high in the fourth quarter.

Despite this historic bull market that boosted performance for many investment strategies, institutional investors’ overall satisfaction with their existing asset managers has declined sharply from the previous year. Specifically, institutional investors surveyed in the eighth annual US Institutional Investor Brandscape® study report an average top 3-box satisfaction score of just 60%, versus 67% in 2016. Continue reading

The Secrets of How, When and What in Institutional Marketing

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Institutional marketing in the financial services space involves outreach to a  specific individual within an entity, company or organization with responsibility for hundreds of millions of dollars. These individuals typically represent large pension funds, endowments or foundations who frequently consult with internal or external peers as well as investment consultants before implementing any changes in their investment strategy.

As you can imagine, marketing to this particular audience requires a degree of finesse that is best informed by understanding the client’s mission,  needs and current investment approach. Surprisingly, this is where many marketing projects begin to falter. Continue reading

Is ESG Investing Relevant in the Institutional Market?

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Environmental, social and governance (ESG) investing is continuing to impact the wealth management space. As individual investors become increasingly concerned with the ethics and environmental impact of the companies they are supporting, they are passing that concern on to the institutions that manage their investments. In fact, ProxyPulse*, a report by Broadridge and PwC, found a growing momentum of ESG proposals in proxy meetings in 2017. Following the US withdrawal from the Paris Climate Accord, the report also suggests an expected increase in questions from shareholders on environmental impact and climate change in 2018.

To keep a pulse on the growth in the ESG category, Cogent tracks interest in and usage of ESG investing among all the audiences we survey: financial advisors, DC plan sponsors, affluent investors and institutional investors. Specifically in the institutional market, we added a new question to this year’s US Institutional Investor Brandscape report, fielded late in 2017 and publishing this month. We asked institutional investors in the US how likely they were to adopt ESG investing in the next 12 months. We found that, while few institutions have already incorporated ESG in their portfolios, usage is considerably higher in the non-profit sector, where the approach to investing tends to be more mission-based than is typical among pensions. Continue reading

European Pensions Jumping on ESG Bandwagon

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European Pensions Jumping on ESG Bandwagon

If there were any doubt as to the appeal of Environmental, Social and Governance (ESG) or Impact Investing in the European institutional market, it can now be put to rest. In a recent survey of defined benefit pension investors, Cogent Reports found that three-quarters or more of European pensions are likely to incorporate ESG investing in their portfolios within the next year. Moreover, this strong interest in ESG investing is evident across pensions of all asset sizes. Yet relatively few European institutions say they have already incorporated ESG or impact investing in their portfolios, suggesting that the category is poised for substantial growth.

A recent article* reported that Europe now accounts for over half (53%) of the $22.89 trillion in global sustainable investment assets. If the European pensions have anything to say about it, that number will quickly multiply, providing a welcome source of new assets to investment firms specializing in this area. Of particular interest to asset managers should be pensions in Switzerland, Italy and the Netherlands, where Cogent found ESG investing earning the strongest appeal. Continue reading

The Key to Success in International Marketing? Location, location, location!

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For US-based asset managers seeking to grow their institutional business overseas, the challenges are many. Asset managers deciding where to focus their efforts, which investment solutions to offer and how to differentiate their brands from those of the established local firms are all critical decisions. But the one consideration that dictates all others is location—determining which countries or regions to target. And what better way to decide where to set up shop than to pinpoint where demand for new managers is greatest?

Earlier this summer, Cogent asked pension investors across Europe how many new asset managers they anticipate adding to their lineups in the next 12 months. Encouragingly, European pensions remain interested in adding new managers to their lineups. Compared with 2014, more institutional investors are likely to add at least one manager to their lineups in the coming year. Opportunity appears greatest in the Netherlands, France and the UK. Similar to the US market, $1 billion-plus institutions are primarily driving the increased interest in new manager additions in the coming year, lending fuel to the strategies of many asset managers that are focusing on the upper end of the institutional market. Continue reading

To Reach DC Plan Sponsors, Tap The Wall Street Journal

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Dozens of 401(k) plan providers are striving to increase awareness of their brands among plan sponsors, who are the ultimate decision-makers when hiring and firing plan providers or even initiating putting a DC plan out to bid. Advertising is a common tactic used to boost brand recognition, yet only 27% of DC plan sponsors recall seeing an ad for at least one of the 34 leading plan providers over the past six months. Part of the reason may be that the
ads are running in the wrong place.

Plan providers courting new business often turn to trade publications and websites to tout their recordkeeping capabilities among a targeted audience. Yet when we asked plan sponsors which print publications they read over the past six months, specifically for 401(k) best practices or 401(k) service providers, nearly half (49%) cite The Wall Street Journal. In comparison, just 13% point to Employee Benefit News and only 10% report reading PLANSPONSOR magazine.

Moreover, when asked to identify the online publications they viewed over the same period, wsj.com is just behind bloomberg.com as the most frequently cited website (30% and 32%, respectively). The New York Times, both print and online editions, is another common resource among plan sponsors, far ahead of trade-related publications such
as Pensions & Investments and HR Magazine. Continue reading

Plan Sponsors Look to Make Shifts in Investment Lineups

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Plan sponsors’ desire to reduce plan costs is substantially impacting their approach to investment menu design and their relationships with DC investment managers. But the impact of the resulting activity varies by plan as well as by asset manager. Overall, 7% of plan sponsors intend to add at least one manager to their investment lineup in the next year. At the same time, 2% plan to drop a manager and 16% intend to do a combination of adding and dropping managers, suggesting that the future is not necessarily secure for all firms.

Plan Sponsors Adding and Dropping Investment Managers

When asked specifically about the managers they will continue to use, 29% of plan sponsors intend to award new business to existing firms while only 15% plan to pull business away—evidence that plan sponsors are concentrating their assets with the smaller number of managers they know. Continue reading

Institutions Sticking With an Active Approach

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Throughout 2016 and into 2017, there has been no shortage of news coverage on the shift of assets from actively managed to passively managed investments in the wealth management industry. With the heightened focus on investment-related fees and increased skepticism over active portfolio managers’ ability to outperform the market index over the long term, many industry pundits are projecting a massive consolidation of active asset managers in the future, with only the strong and the few able to survive.

Yet at least one segment of the market continues to offer opportunity for active managers: the institutional market.

In fact, our research conducted in Q4 2016 found that institutional investors were reaffirming their commitment to actively managed strategies a maintaining or even increasing their active asset allocation levels despite the uncertain political climate during the latter half of 2016. Continue reading

Institutions’ Growing Appetite for Risk

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The search for higher returns is the leading driver for asset allocation shifts

Risk-On-Image

The 2016 US presidential election sparked waves of populism and uncertainty. For the financial markets, the possibility of a Trump presidency seemed to cause a risk-on mentality, as his tweets were met with positive market reactions. And even before the Dow Jones Industrial Average surpassed 20,000, institutional investors signaled they were also adding risk. The survey fielding of our US Institutional Investor Brandscape report, fielded from mid-October 2016 to early January 2017, gives us a unique snapshot of the reactions of institutional investors in a distinct period for all of us.

Both pensions and non-profits de-emphasized de-risking as a driver of asset allocation changes this year. While de-risking is less of an issue for non-profits compared with pensions, this finding corresponds to the risk-on market mentality. Importantly, de-risking was the leading driver of asset allocation shifts among pensions in previous years and $1 billion-plus pensions continue to focus on risk. At the same time, corporate defined benefit plans place greater emphasis on the search for higher yield at the expense of de-risking. Continue reading

Is Financial Wellness the New “Thing” in DC Plans?

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financial-wellness

As competition in the DC market intensifies and thoughts of the DOL fiduciary ruling’s impact shatter historical practices that used to make servicing DC plans profitable, plan providers and DC advisors are searching for new ways to add value and continue to grow. Financial wellness programs just may be the new big thing. In fact, industry experts are projecting that tomorrow’s retirement plan advisors will need to build wellness programs into their business model to create a more holistic offering for their DC clients and expand their services in order to stay relevant.

According to a recent Cogent Report from Market Strategies, just three in ten (29%) DC advisors offer a financial wellness program as part of their retirement plan advisor practice. Here, we’re referring specifically to a program designed to educate employees about personal financial risks, which may include loss of income due to premature death or illness or unexpected medical expenses, and provide the tools to manage those risks. Advisors who do offer such programs rely equally on the plan provider or their own firm’s proprietary offering. Continue reading