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Welcome to the third edition of the Foreside Connections e-Newsletter! Foreside Connections serves as a powerful tool for enhancing the ties between Foreside and its valued clients. The aim of this quarterly publication is to keep you informed of new initiatives, corporate updates, upcoming events and industry trends. We hope you find this publication a valuable resource and welcome your suggestions and feedback.
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Letter From The President
On behalf of Foreside, I want to thank you for trusting us to provide your team with services and support to help you achieve your goals. As we discussed in our prior edition of Foreside Connections, we continue to focus on hiring industry experts and enhancing our capabilities across all aspects of distribution and compliance services. We are pleased to announce that Foreside has entered into an agreement with Diamond Hill to acquire Beacon Hill Fund Services ("Beacon Hill") located in Columbus, Ohio. The acquisition is expected to close on July 31. In operation since 2008, Beacon Hill provides many of the same products and services, such as an array of distribution services, fund officer services and regulatory and compliance consulting services. They also provide a variety of business management services to both U.S. and non-U.S. investment managers. The acquisition of Beacon Hill brings together some of the industry's most experienced professionals and enhances our management, services, and opportunities for growth. We will be bringing to Foreside a staff of 22 professionals and 19 clients with approximately $30 billion in assets.
Investment managers in every market are increasingly seeking a focused, objective and independent partner to provide advice and customized solutions to all aspects of management, governance, and distribution to help grow their businesses. The combination of Foreside and Beacon Hill brings a robust organization that works in concert with investment managers to build, manage, and grow their products and franchises. We believe these capabilities and our unique focus truly differentiate Foreside in the global marketplace
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Foreside remains committed to our solutions which allow our clients to focus on their core business without sacrificing distribution and compliance best practices. Thank you again for your continued support.
David Whitaker
President
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ETF/ETP Assets Globally Reach a New Record!
ETFGI, and independent research and consultancy firm on trends in the global ETF/ETP ecosystem, reported at the end of May 2016 assets invested in ETFs/ETPs listed globally reached a new record high US$3.143 trillion. This is according to preliminary data from ETFGI's May 2016 Global ETF and ETP Industry Insights Report.
- At the end of May 2016, ETFs/ETPs listed globally reached a new record high of US$3.143 trillion.
- ETFs/ETPs listed in the United States reached US$2.229 trilion and US$530 billion in Europe.
- Globally, there were 6,374 ETFs/ETPs from 280 providers listed on 65 exchanges in 51 countries.
- The US Industry had 1,902 ETFs/ETPs from 96 providers listed on 3 exchanges.
- The European Industry had 2,219 ETF's/ETP's from 52 providers listed on 25 exchanges in 21 countries.
To view the growth of the ETF/ETP universe click
HERE.
Foreside is the underwriter for over 20 ETF/ETP sponsors, comprising of over 270 funds, with AUM over $67 billion. Foreside also maintains over 150 exchange-traded product Authorized Participant (AP) Agreements.
To learn more about Foreside's ETF/ETP offerings please contact Jason Knight at (207) 553-1955 or
jknight@foreside.com
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Foreside Updates
Conference Recap
In late May we had members of the Foreside Consulting Group and the Foreside Compliance Group attend the 2016 FINRA Annual Conference. This is FINRA's
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Susan Moscaritolo and Jennifer DiValerio of Foreside.
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premier event with over 1,500 attendees and 55 exhibitors, the conference provided the opportunity to share ideas on current regulatory and compliance topics with industry professionals and regulators. FINRA's CEO, Rick Ketchum reiterated the importance of compliance culture for firms during his conference remarks. The major focus of both the speakers and the attendees was the Department of Labor ruling and the ongoing question of how will the DOL ruling impact the industry. For additional information on the conference and details regarding the upcoming 2017 FINRA Conference please click
HERE.
Foreside National Accounts Team attended the Strategic Insight Fund Trends Conference (SIFT) in New York City, June 21-22nd. This conference provided a forum to learn from key platform distribution executives as well as an opportunity to dive deeper into the industry trends shaping the distribution landscape for both mutual funds and ETFs. The impact of the DOL Fiduciary rule continues to be a catalyst driving cross channel implications on share class pricing and intermediary/platform costs. SIFT also highlighted how asset managers will need to adapt their retail distribution efforts to new realities, sharing how to compete differently against their competitors by distinguishing themselves on product, brand, value-add and risk management. For additional insight from the conference please click
HERE.
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Foreside Speaks!
On Thursday, April 28th, Foreside co-sponsored a webinar with Stradley Ronon, Broker-Dealer Issues in Distributing Private Funds. Jennifer Hoopes, Foreside's Head of Consulting and Global Business, joined Stradley Ronon attorneys Lawrence P. Stadulis and Peter Tsirigotis to discuss the myriad complex issues associated with the marketing and distribution of private fund securities in the U.S.
After a high-level overview of the numerous securities laws that adivsors and their private funds are subject to, the panelists discussed the various options for distribution, including what is commonly referred to as the "issuer's exemption". For advisors unable to take advantage of this exemption, the panelists presented three options for distribution: (1) hire a third-party marketing firm; (2) register the advisor's sales force with an existing broker-dealer; or (3) register an advisor affiliate as a broker-dealer.
Please click
HERE
if you would like to listen to the webinar. If you would like to discuss your distribution options in more detail, please contact Jennifer Hoopes at (207) 553-7138 or
jhoopes@foreside.com.
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The Foreside Experience!
Foreside's client base has expanded over the past 10 years to include a diverse range of asset management firms from mutual funds and ETF's to hedge funds and private equity firms. Foreside has responded to our clients' ever changing businesses by continuing to enhance and expand our service offerings. This has included supporting foreign firms that wish to launch and market products in the U.S., sponsorship of NSCC participant membership for foreign products, expanding consulting services and the willingness to customize service offerings. In addition, beginning August 1st with our acquisition of Beacon Hill Fund Services, Foreside will offer two new service lines: Business Management and Trust Governance.
Interestingly, also over this time period our clients have demonstrated an increased desire and need for an enhanced relationship experience. After listening to our clients, we believe the optimal approach involves re-orienting our client service model to focus on deepening our relationships with you. Foreside has consistently received high marks for our excellent, high-touch customer service and we want to meet and exceed the needs of our clients by taking this one step further.
What does this mean for you? You can look forward to a more comprehensive service experience with Foreside. Foreside's relationship managers want to know you better, to understand your unique businesses and needs so that we can provide you want a more robust experience. We at Foreside view our clients as our partners and knowing your industry's priorities is an essential part of demonstrating our value to you.
Foreside's relationship managers consistently demonstrate integrity, reliability and professional competence. Moving beyond client service and into relationship building allows our business to grow alongside yours and adapt to your needs. You should look to your relationship manager as a trusted resource, squarely focused on helping you achieve your goals. Foreside's relationship managers maintain a strong network of key subject matter experts within the firm crucial to crafting tailored, innovative solutions for our clients. Our priority remains to offer you strong judgment and big picture thinking on top of well-developed industry and functional expertise. We want your experience to be useful and valued and trust you will appreciate speaking to relationship managers that embody this approach.
In the coming weeks, your relationship manager will be reaching out to introduce themselves and to learn more about you and your organization. We are excited about this enhanced relationship model and the continued growth of your business.
Should you have any questions regarding the Client Management team please contact Emmy Bernard at (207) 210-6318 or
ebernard@foreside.com
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Foreside Connections Call!
Navigating LPL Financial!
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David Abraham |
Foreside proudly continues the quarterly "Connections" conference call series for 2016. Partnering with innovative industry experts, we aim to cover a broad spectrum of industry topics, to assist you with the growth of your business. On Tuesday, June 7th, we hosted the 2nd Quarter Connections conference call with guest speakers David Abraham and Andrew Gibson of the LPL Sponsor Relations Team.
Mr. Abraham and Mr. Gibson
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Andrew Gibson |
provided critical insights and best practices for on-boarding the various LPL platforms, as well as further guidance into maximizing your firm's access and opportunity once on their platform. Additionally, they addressed many specific questions around best practices, research team penetration and an update regarding changes to their SAM platform.
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2016 B/D Priorities
Looking back at the first half of 2016, two issues standout as critical to broker-dealers and their compliance programs.
- Both FINRA and the SEC have continued to focus on their cybersecurity initiatives, looking at firms' information security controls through testing and assessments. It is critical for a firm not only to have a solid cybersecurity policy and program, but to test that program on a regular basis. Chief Compliance Officers need to be involved in the testing and in the reporting structure. Enforcement actions will be the norm if firms are out of compliance on this issue according to both FINRA and the SEC.
- The Department of Labor issued its final rule regarding fiduciaries, which is scheduled to go into effect April 2017. Financial advisors will be required to recommend what is in the "best interests" of their clients when advising on 401(k) plan assets, IRAs and other retirement accounts (after-tax investment accounts are exempt). This rule will require additions to firms' WSPs, training for financial advisors and technology upgrades. Many financial advisors will also see changes in how they are compensated for transactions (fee based rather than transaction-based commissions) or additional contractual requirements if they continue to accept commissions.
If you have any questions about either of these issues or other matters related to your broker-dealer, please contact your Foreside Consultant.
Foreside's Broker-Dealer Consulting team's expertise ranges from full-service retail brokers to private equity firms and mutual fund distributors. Foreside recently supported a firm with a new and unique business model to register as a broker-dealer. We prepared all of the compliance and supporting documents, managed the communications with FINRA and brought the registration to a successful approval. The Broker-Dealer Consulting team is also in the final stages with another client to complete its registration as a new broker-dealer and provides consulting to numerous other clients, including mutual fund distributors, trading firms, municipal securities dealers, and private equity firms.
If you are thinking about registering a broker-dealer or have an existing broker-dealer and would like some regulatory and compliance support and guidance, please contact Jennifer Hoopes, Head of Consulting and Global Business at 207-553-7138 or
jhoopes@foreside.com.
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Upcoming Events
Quarterly Connections Call - September 2016
Join Foreside along with industry fund distribution experts as they discuss what it means to support advisors beyond just offering products.
etfXchange '16 - September 2016
Representatives from Foreside will be attending the BNY Mellon etfXchange '16 conference on September 19-21 in Dana Point, CA. With the ETF industry passing a major milestone of $3 trillion the Symposium is an excellent way to stay ahead of industry trends in this fast moving, challenging environment. For more information on etfXchange'16 please click HERE.
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Industry News/Resources
For links to recent industry news, resources, and insightful commentary please click
HERE
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About Us
Distribution and Compliance Professionals dedicated to your success.
Foreside is committed to delivering innovative services that not only meet current requirements, but also anticipate emerging regulatory and marketplace developments. Clients rely on us to provide the information, operational support and strategic advice that are needed to thrive in today's complex arena of investments, compliance and risk management. We collaborate with recognized service providers to ensure our clients receive informative and quality services. Foreside is not affiliated with any of its partner service providers. For more information about Foreside, including service offering overview, staff bios, current industry news and upcoming industry conferences, visit our website at
www.Foreside.com
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Sincerely,
Emmy Bernard
Managing Director and Head of Client Management
Foreside Financial Group, LLC |
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