E*Trade Restrategizing Fund Offerings

Recent mergers of E*Trade’s proprietary index fund line-up could indicate a shift in strategy for the online brokerage firm. Despite recently liquidating two funds and merging two others, the firm insists that it is committed to providing customers with a comprehensive slate of funds.

However, the mergers are clearly linked to strategic changes taking place at the firm. "There will be a number of things coming up that we’re not quite ready to share the details of yet," said Liat Rorer, head of investment products at E*Trade.

While Rorer would not divulge details of E*Trade’s impending plans, she did say that it is considering including actively-managed funds to its line-up.

Broadly, E*Trade is looking to provide an array of investment products and services. To that end, the firm has developed separate account and basket product offerings.

Since their February launch, managed accounts have gotten off to a bang, said Rorer. "We’re very happy with the progress that we’ve made, that the product has sold well," she said. Rorer declined comment on the number of accounts or assets under management in the new products.

E*Trade Stock Baskets will be offered later this quarter with 20 baskets designed by Standard & Poors. While the product’s pricing structure has not yet been established, Rorer said it will be based on asset levels with set price breaks.

With investors reconsidering whether they want to embrace self-directed investing, E*Trade is now looking to provide different levels of advice to meet a growing need among investors.

"I believe that most people have parts of their financial assets where they really do want advice and E*trade is looking for many ways to provide that advice, from personal management, through to our brokerage offerings where the investor has complete control," explained Rorer.

In lieu of a planner’s advice and handholding, E* Trade offers tools and Morningstar recommendations to provide a warm, human experience when surfing the site and making financial decisions, Rorer said. "We’ve tried to build our site in the most intuitive manner and in a way that’s really usable for the investor and really intuitive in the way they think about their investments," she said. "We really spend a lot of time building the site and tools so they provide a warm atmosphere and a handholding atmosphere more than a purely analytical one."

For reprint and licensing requests for this article, click here.
Money Management Executive
MORE FROM FINANCIAL PLANNING