While 88% of mutual fund companies that Corporate Insight tracks offer materials on market volatility, only 40% organize this content into centralized outlets. This, Corporate Insight said, is “a key factor in determining firms’ effectiveness in communicating with clients and prospects during ongoing market instability.”
The market research firm gave high marks to Fidelity, T. Rowe Price and Franklin Templeton for displaying market volatility materials, including streaming video commentary, in well-organized resource centers on their homepages. Fidelity augments this with actionable investment advice, and Franklin, T. Rowe, Vanguard and Legg Mason also include prominently displayed letters from their CEOs. In fact, Franklin’s CEO letter was the most visible, while Vanguard is featuring detailed analysis from an array of high-ranking officials.
“Volatility is not a topic to be swept under the rug,” said Jeff Latzer, senior analyst for mutual funds at Corporate Insight. “By confronting the issue head-on, asset management firms are more likely to inspire prospects and instill confidence in clients and keep them invested in the market. A message of assurance from key executives, alongside historical context and educational resources, is a particularly effective approach.”
Corporate Insight also found that 73% of the firms it tracks have discussed the Standard & Poor’s credit downgrade, and 33% are addressing various markets and sectors around the globe, including emerging markets and European equities.
In addition, 33% are using historical perspectives of past downturns to provide reassuring forecasts for current market conditions. American Funds is doing the best job of this, in Corporate Insight’s estimation, with its interactive “Guide to Market Recoveries.”
One-third are also featuring commentaries from their CEOs, and 47% are using multimedia content, including streaming video.