NEW YORK, Dec. 14, 2017 /PRNewswire/ -- As equity markets
continue to hit new highs, we believe advisors are growing
increasingly concerned about a potential market correction and have
little confidence that passive investment strategies provide
adequate downside protection for client portfolios, finds a new
survey of more than 200 financial professionals conducted by
AllianceBernstein ("AB").
The survey, fielded at the 2017 Annual Schwab IMPACT Conference,
held in Chicago from November 14-17, 2017, also found that many
advisors are interested in flexible fee structures. Most financial
professionals (77%) would consider an actively managed mutual fund
that charges passive-like fees, with higher fees only when the fund
outperforms its benchmark index.
"In recent years, the shift from traditional active strategies
to low-cost passive funds means that investors have locked in lower
fees, but they've also given up the opportunity to outperform,"
said Chris Thompson, head of
Americas sales at AB. "A flexible management fee that starts low
and goes up only when the fund outperforms provides a very
attractive alternative to passive, and aligns the interests of
asset managers and investors."
The survey also found that the majority of advisors (78%)
believe the market is due for a correction, and in a down market,
62% would expect passive strategies to perform worse than their
active counterparts.
"Advisors enjoy the low fees offered by passive strategies, but
do not feel confident putting their client assets on auto-pilot at
a time when markets continue to reach new highs. This is creating
an opening for an entirely new category of products that combines
the fee benefits of passive with the attractive potential of
active," added Thompson.
*This year, AB launched three performance-based fee
funds–the first of their kind. They charge index-fund-like advisory
fees if performance is at or below the index and a scaled
performance fee as they outperform the index.
About the Survey
The survey was conducted onsite at the 2017 Schwab IMPACT
conference with a total of 210 respondents comprised of registered
investment advisors, financial advisors and financial
professionals.
About AB
AB is a leading global investment management firm that offers
high-quality research and diversified investment services to
institutional investors, individuals and private wealth clients in
major world markets. At September 30,
2017, AB Holding owned approximately 35.2% of the
issued and outstanding AB Units and AXA, a worldwide leader in
financial protection, owned an approximate 64.9% economic
interest in AB.
Additional information about AB may be found on our website,
www.alliancebernstein.com.
Investors should consider the investment objectives,
risks, charges and expenses of the Fund/Portfolio carefully before
investing. For copies of our prospectus or summary prospectus,
which contain this and other information, visit us online
at www.abfunds.com or contact your AB
representative. Please read the prospectus and/or summary
prospectus carefully before investing.
AllianceBernstein Investments, Inc. (ABI) is the
distributor of the AllianceBernstein family of mutual funds. ABI is
a member of FINRA and is an affiliate of AllianceBernstein L.P.,
the manager of the funds.
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SOURCE AllianceBernstein