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Effective Regulation Of Financial Planning
With the DOL rule in a state that is hard to describe and the CFP Board proposing updates to its rules, the topic of regulation has been on my mind a lot lately. I found myself referring to some of my prior writings in this publication, the Journal of Financial Planning and a few others. Despite the progress the financial planning profession has made, I was struck by how little has changed. The professional financial planning community is still complaining about the same issues. These lamentations are warranted because these problems have not been solved.

Is diversification really necessary?
Diversification is one of the foundation stones of the investment industry. Clients are constantly reminded of the importance of maintaining a diversified portfolio as exposure to different asset classes and geographies perform differently across different market conditions. A more recent movement has, however, suggested this is actually unnecessary and that simply maintaining a low-cost exposure to the equity market will deliver a better performance over the long term, despite fluctuations in performance. Yet how well does this view stand up to scrutiny?

Market While You Sleep
Todd Sensing, a portfolio manager and 10-year veteran of the hedge fund world, recently decided to change careers. He had two sons on the autism spectrum and realized that parents like him had few resources for special needs planning. There are a lot of insurance products in this field and not a lot of fiduciaries. For instance, people might need to fund a special needs trust or look for no-load policies through third-party actuaries, it’s also a very emotional topic. Sensing says he can help people wade through that—because he did.

Wealth + Health care = Whealthcare
If you are like most advisors, you may believe that the greatest threat to your business is that all of your clients are dying. That’s right; it is inevitable. Most advisors are by now aware that a massive generational wealth shift is under way. If you are a typical successful advisor, many of your clients are at or nearing retirement. As they age and pass away, their wealth will transfer to the next generation. If you do not have a good relationship with that next generation, you are likely to lose their accounts. But there is a more immediate threat to your business that is much less frequently discussed: the threat that your clients will have health or age-related issues that jeopardize their financial decision-making and their wealth before they die.

UK regulator looking closely at whether platforms offer investors value for money
While the areas of focus of the Investment Platforms Market Study are wide-ranging, writes Mike Barrett, most of them come down to one topic - the impact of vertical integration on the market and investors

UK regulator looking into conflict of interest in platforms
Forcing asset managers to offer the same price to all platforms could drive up costs to consumers, Bella Caridade-Ferreira has warned after the Financial Conduct Authority (FCA) initiated its Investment Platforms Market Study today.

US advisors gear up for DOL fiduciary rules implementation
The Department of Labor (DOL) Fiduciary Rule is a new ruling, originally scheduled to be phased in April 10, 2017 – Jan. 1, 2018, but delayed until June 9, 2017, including a transition period for the application of certain exemptions to the rule extending through Jan. 1, 2018. The rule expands the “investment advice fiduciary” definition under the Employee Retirement Income Security Act of 1974 (ERISA). If this sweeping legislation (1,023 pages in length) is not stopped outright, it will automatically elevate all financial professionals who work with retirement plans or provide retirement planning advice to the level of a fiduciary, bound legally and ethically to meet the standards of that status. While the new rules are likely to have at least some impact on all financial advisors, it is expected that those who work on commission, such as brokers and insurance agents, will be impacted the most.

Don’t be scared of giving the right advice
Advisers should not shy away from giving advice they themselves would not follow for fear of what the regulator might think, Rory Percival has said.

New Canadian research suggests trail commissions do more harm than good
In essence, the regulators signalled that the issue of trailing commissions' legitimacy has reached a defining moment and, from this point forward, there will be no tolerance for the casting of bogus doubts on scientific proof pertaining to that matter. Such tactics will not be allowed to disrupt development of regulatory policy on the reform of mutual fund fees. This is especially relevant to the question of whether trailing commissions are harmful and should be banned.

Product suitability "checklists" are counterproductive
The regulator will not issue checklists for advisers to allow them to stick to a particular protocol when assessing product suitability for their clients because they are "counterproductive", technical specialist Rory Percival has said.

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