RIA Aggregators Drive Advisor Managed Accounts Adoption in 401(k)s

July 1, 2021 — Boston

This issue of The Cerulli Edge—U.S. Monthly Product Trends analyzes mutual fund and exchange-traded fund (ETF) product trends as of May 2021, discusses registered investment advisors' (RIAs') growing use of advisor managed accounts (AMAs), and explores what strategies providers can use to develop marketable retirement income products.

Highlights from this research:  

  • Mutual fund and ETF assets pushed even higher in May as mutual funds topped $19.8 trillion while ETFs passed $6.3 trillion. Monthly net flow figures favored ETFs ($64.5 billion) over mutual funds ($18.9 billion)—a trend that has been consistent so far in 2021.
  • RIA aggregator firms, which typically operate in the mid-sized-plan market, have been the most active plan advisors in the AMA space. For plan advisors with both a retirement plan and wealth management practice, AMAs could serve as opportunities to attract new wealth management clients. In many cases, the plan advisor is restricted to using investment products from the plan’s core lineup, but, in some instances, the plan sponsor may allow the plan advisor to include non-core investment options.
  • Creating products and services that offer attractive and reliable income streams is a key challenge facing providers. When seeking to broaden their product offering into new areas, providers must remember that properly setting expectations is a crucial element of the overall strategy. Though every piece of marketing collateral reminds investors that past performance is not necessarily indicative of future returns, investors consistently cite past performance as a key criterion in their investing decisions. By responsibly developing and marketing products through new vehicles, providers with risk management expertise have a distinct opportunity to succeed in the burgeoning retirement income market.

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Note to editors

These findings and more are from The Cerulli Edge—U.S. Monthly Product Trends, June 2021 Issue.

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