Coverage of fund trends usually involves a wave of commentary about expected market performance. Inflation, unemployment, GDP and other economic indicators are also discussed and debated. Yet there are other trends driving the fund industry that will significantly shape how management companies operate. Boston Financial has identified five key forces that continue to alter the industry landscape.
1. Shifts in product distribution channels. Intermediaries are increasingly influencing fund distribution, changing the traditional relationship between fund companies and their underlying investors, and playing a part in an investor's fund selection and asset allocation decision process. The rise in intermediary activity has led to the proliferation of subaccounts and a shift away from traditional transfer agent networked accounts. As a result, roles once overseen by the transfer agent - such as compliance and financial oversight - are now the responsibility of intermediaries.