1) Aberdeen Standard Investments Reduces Fee for its Gold Exchange Traded Fund (SGOL) PR Newswire | 12/3/2018
Because… The price war has apparently been extended to gold ETFs. GraniteShares introduced its Gold Trust (BAR) in August 2017 with a very low expense ratio of 20 basis points (bps), which was further reduced to 17.49 bps in October 2018 when the firm’s total assets surpassed $350 million. Aberdeen Standard Physical Swiss Gold Shares ETF, which was acquired from ETF Securities in April, is the third largest gold ETF. Its fee cut from 39 bps to 17 bps makes the fund the cheapest physical gold ETF on the market. With the DJIA tumbling 799.36 points on December 4 and stock markets giving up the year’s gains, the heated competition among gold ETFs could benefit investors looking to use gold as a portfolio diversifier.
2) Wealthfront Launches Free Financial Planning PR Newswire | 12/4/2018
Because… From commission-free trading to zero-fee index mutual funds, firms are trying to prove there is such a thing as a free lunch. Wealthfront’s move to offer free financial planning to all again underlines the appeal of the freemium model. Since many individual investors do not use advisory services due to the high cost, they may be willing to give it a try if a tool is free to use. Wealthfront manages nearly $11.5 billion for 250,000 customers, while the largest independent robo-advisor Betterment manages $15 billion for 400,000 customers. With its artificial intelligence-powered financial advice engine, Wealthfront is hoping to lure more clients and catch up with other leaders in the space.
3) It’s the Worst Time to Make Money in Markets Since 1972 Bloomberg | 12/4/2018
Because… While the conclusion that “Things haven’t been this bad since Richard Nixon’s presidency” is disappointing, it coincides with the general market views. The latest Natixis report found that 65% of institutional investors predict that the U.S. bull market will end in the next 12 months. JP Morgan’s multi-asset strategy team recommends cash over stock for the first time in a decade, as reported by Bloomberg. Heighted market volatility and investor aversion to risky assets are presenting more challenges to active asset managers, but every crisis creates opportunities. Those that can control risks and provide downside protection will be more likely to win investors’ favor.