CHICAGO - Hundreds of mutual fund and ETF providers gathered at Morningstar's Investment Conference last week to pursue their equivalent of high-speed dating: meeting face-to-face with the 1,400 planners and advisors in attendance.

From the fund provider viewpoint, it can be one of their most targeted and intense distribution and marketing strategies, according to Morningstar's Russ Kinnel, the firm's director of mutual fund research. "They're here to build relationships with advisors and get their message out," he says. "And it's even more important to face advisors when things aren't going so well," he added, calling out one attendee - PIMCO's Bill Gross and his PIMCO Total Return Fund, which suffered $4.3 billion in net outflows in May.

"When performance isn't as good and you have controversy out there, that's going to lead people to sell the fund, so that's when it's especially important to hear from PIMCO and have concerns addressed," Kinnel says.

I asked Kinnel what we should expect to see in the year ahead for fund providers as they fight to differentiate their products in what he calls an overcrowded market. He noted there will likely be a shakeout in alts and nontraditional bond funds as some funds have disappointed investors and need to deliver results rather than promises. Therefore, among fund providers and their products, there will be a growing divide between the haves and the have nots, he said.

Mutual fund and ETF providers must do a better job setting expectations when meeting with advisors, he added. They must more clearly outline the limitations of certain funds and they must be realistic so advisors can better help their clients.

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