Increased Competition For RIAs

Brokers, Investing

According to a Charles Schwab survey, close to half of RIAs believe that online investment advisories will soon be one of their top competitors. Online competition is coming from two fronts – traditional online brokers that are beginning to offer advisory services and a new wave of personal finance startups. While the benefit that these new competitors offer consumers is primarily centered around cost, RIAs believe that the lack of personalization and one-on-one interaction will impede the growth of these competitors in the market. That said, most RIAs do recognize that a younger generation of clients will likely need a different service model than what is used today. Much of the online advice space, particularly new wealth management startups such as Betterment and Jemstep, use algorithmic-based investment advice to generate portfolio recommendations.

T. Rowe Price is launching a new industrials-focused mutual fund. The fund will invest 80% of its net assets in industrials, and 40% of its assets in companies outside the U.S. across at least five different countries. Net expense ration will be around 1.05%, with the minimum initial investment at $2,500 or $1,000.