Competition to offer low-cost products will continue to make it challenging for middle market players. New products that do not quickly scale to the critical mass needed to defray operating costs and establish market recognition often fail to survive. Nonetheless, middle market participants can still compete in this market. … READ MORE >
Financial services
Buzz on pot legislation fades as focus turns to vaping
In addition to shielding banks and credit unions, the Secure and Fair Enforcement Banking Act is also designed to make it easier for cannabis-related enterprises, like dispensaries and growers, as well as business that serve them, like law firms and real estate companies, to access the banking system with funds derived from cannabis products. … READ MORE >
In the free-for-all among retail brokers, will the middle market be left behind?
Charles Schwab Corp. announced recently that it would eliminate trading commissions for retail investors, making Schwab the latest Wall Street broker to embrace the push to zero commissions.
But with $3.75 trillion in assets, Schwab is in a position to make such an aggressive move. Like other larger retail e-brokers, Schwab is capitalizing on its scale advantage, one that allows it to attract new client assets to its platform and strengthen its market share. … READ MORE >
Passive investing reaches a milestone, surpassing value of active counterparts
For years a profound shift has been taking place in the financial community as individual investors have increasingly favored a passive, low-cost approach over the traditional actively traded assets. Last year, that shift reached a significant milestone as the value of assets under passive management surpassed the value of active … … READ MORE >
Opportunities for insurers in a low yield bond environment
Lower yields on bonds, underscored by an inverted yield curve and 10-year rates below 2%, are cause for insurance companies to reevaluate their fixed-income investment positions. … READ MORE >
Public scrutiny over ESG holdings will cause universal reporting change
As environmental, social and governance investing continues to grow in popularity, investors need to carefully evaluate how their holdings will be viewed by the public. Asset managers must balance their desire to promote ESG consciousness with their fiduciary duty to drive financial returns. … READ MORE >
Family office direct investing is on the rise
The amount of wealth managed by family offices continues to grow as more families sell out of their founding businesses. Direct investing by these offices have grown more than 100% in the last 10 years. … READ MORE >
Foreign investors eyeing U.S. companies may want to learn more about CFIUS
For a very long time the United States has attracted direct investment from overseas. As the trade war between the United States and China has escalated, CFIUS, a little-known U.S. regulatory body that has traditionally operated behind a veil, is becoming more visible following legislation in 2018 that gives it more power to scrutinize inbound dollars. … READ MORE >
Low rate environment poses challenge for banks
The Fed recently cut its lending rate by 25 basis points and is expected to cut again later this year. Meanwhile, as longer-term rates continue to decline, banks will be faced with further pressure on their net interest margins. … READ MORE >
For private equity funds, bigger is not always better
The rise of billion-dollar private equity buyout funds reflects the growing demand from large investors willing to write big checks. Interest rates remain historically low and, with additional rate cuts almost certain to come, investors continue to expect high returns. The larger the fund, so the thinking goes, the larger … … READ MORE >