Fidelity Clearing & Custody Solutions to Expand ETF Offering to Broker-Dealer Clients

High Fidelity Original Soundtracks - Dry the Rain

BOSTON--(BUSINESS WIRE)--Fidelity Clearing & Custody Solutions (FCCS) -- the division of Fidelity Investments that provides clearing, custody and investment management products to registered investment advisors, broker-dealers, family offices and banks -- today announced that its broker-dealer clients will have access to 70 commission-free iShares ETFs in non-commission-based managed accounts, in addition to the 15 Fidelity-managed commission-free ETFs it already offers. Fidelity now provides its broker-dealer clients with the most comprehensive commission-free ETF offering in the marketplace.1

Through Fidelitys 15 ETFs, which includes 11 passive sector ETFs, three active fixed income ETFs and the Fidelity Nasdaq Composite Index ETF, and its strategic relationship with BlackRock which includes an additional 70 commission-free iShares ETFs, FCCS clients have access to and preferred pricing for a broad selection of ETFs across a range of asset classes: sector-based, international and domestic equity, fixed income and commodities, covering more than 50 different Morningstar categories.

Delivering our broker-dealer clients access to our commission-free lineup of Fidelity and iShares ETFs has been a priority since we launched the offering, said Mark Haggerty, head of product for Fidelity Institutional. We now offer broker-dealers a comprehensive suite of investment products and solutions which enables them to efficiently evaluate and incorporate these investments into their clients portfolios.

FCCS clients have access to a range of investment products integrated into its platform, including managed accounts, ETFs, mutual funds and alternative investments.

FCCS also has a dedicated ETF Research Center for clearing and custody clients which features information on ETFs, educational content from Fidelity Investments and BlackRock iShares, and search/screening tools. Key features of the research center include:

Quick Screener: Easy access to the most commonly used criteria for researching ETFs.

Custom Screener: Take ETF screening to the next level by choosing from 19 basic and 23 advanced screening criteria.

ETF Profile: Review detailed information such as historical performance, underlying holdings, expenses, etc.

Compare ETFs: A side-by-side comparison of up to three ETFs at a time.

Liquidity Analyzer & Correlation Tracker: Advanced ETF research tools for creating a portfolio of ETFs.

Fidelity has been meeting the ETF needs of customers for more than a decade by providing its brokerage customers, both individual investors and advisors, access to thousands of ETFs and currently has more than $230 billion in ETF assets under administration.2

About Fidelity InvestmentsFidelitys goal is to make financial expertise broadly accessible and effective in helping people live the lives they want. With assets under administration of $5.3 trillion, including managed assets of $2.0 trillion as of April 30, 2016, we focus on meeting the unique needs of a diverse set of customers: helping more than 25 million people invest their own life savings, nearly 20,000 businesses manage employee benefit programs, as well as providing nearly 10,000 advisory firms with investment and technology solutions to invest their own clients money. Privately held for nearly 70 years, Fidelity employs 45,000 associates who are focused on the long-term success of our customers. For more information about Fidelity Investments, visit https://www.fidelity.com/about.

The content provided herein is general in nature and is for informational purposes only. This information is not individualized and is not intended to serve as the primary or sole basis for your decisions as there may be other factors you should consider. Fidelity Investments does not provide advice of any kind. You should conduct your own due diligence and analysis based on your specific needs.Third party marks are the property of their respective owners; all other marks are the property of FMR LLC.Fidelity Clearing & Custody SolutionsSM provides clearing, custody, or other brokerage services through National Financial Services LLC or Fidelity Brokerage Services LLC, Members NYSE, SIPC.Unlike mutual funds, ETF shares are bought and sold at market price, which may be higher or lower than their NAV, and are not individually redeemed from the fund. Before investing, consider the mutual fund or exchange traded products" investment objectives, risks, charges, and expenses. Contact your investment professional or visit advisor.fidelity.com for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.Fidelity Investments Institutional Services Company, Inc., 500 Salem Street, Smithfield, RI 02917763378.1.0

1 Based on a comparison of public information from other firms providing clearing services to broker-dealer firms, as of May 2016.2 Based on internal Fidelity data, as of April 2016.

Source: http://www.businesswire.com/news/home/20160607006213/en/Fidelity%25C2%25AE-Clearing-Custody-Solutions-Expand-ETF-Offering

Continue Reading ..

Fidelity 401(k) lawsuit could up ante for plan advisers

Regina Spektor - "Fidelity" (Live In London)

A lawsuit filed recently against Fidelity Investments, the largest record keeper of defined contribution plans in the U.S., highlights the growing scrutiny on 401(k) plan costs and increased need for retirement plan advisers to evaluate all tranches of fees paid to plan providers.

The suit, Fleming v. Fidelity Management Trust Co., alleges that the record keeper engaged in a pay to play scheme with Financial Engines Advisors, a provider of participant-level robo investment advice services in the Delta Family-Care Savings Plan. It also alleges that Fidelity at times acquired higher-cost funds through the plan"s brokerage window.

Under the co-called pay-to-play arrangement, Financial Engines gave approximately half of the 45-basis-point fee investors paid for advice to Fidelity in the form of a kick-back for inclusion on its record-keeping platform, according to the complaint.

Plaintiffs allege that"s plainly unreasonable on a relative cost basis, given participants received little value for this addition to the advice fee, and violates Fidelity"s fiduciary responsibility and the prohibited transaction rules under the Employee Retirement Income Security Act of 1974.

I think 401(k) advisers now really have to understand much more than they did before, said Marcia Wagner, principal at The Wagner Law Group. They have to understand the inner working of their vendors and how the hot dog is created. If there"s something not kosher in the hot dog, you have to make sure the pork comes out.

This is the first time I"ve seen the pay-to-play be an issue with providers of computerized investment advice on 401(k) platforms, Ms. Wagner said, adding that it could be a big deal for advisers because these types of compensation arrangements are fairly common. That"s how a lot of the industry works," she said. "And if that"s going to be prohibited, then it"s an issue.

Of course, it remains to be seen whether a court will find plaintiffs" arguments to be sound.

Anybody can sue anybody. Until a judge rules or a jury rules it doesn"t mean anything, really, said Fred Barstein, founder and chief executive of The Retirement Advisor University. I didn"t see any real systemic issue or big issue here, unless [the fee] was unreasonable or they weren"t disclosing it.

It"s really the responsibility of the plan sponsor to ensure fees are reasonable for the services being rendered, Mr. Barstein added.

Basically, the takeaway for advisers boils down to advisers needing to scrutinize any sort of markup on a platform they"re recommending, knowing what the markup is and if it"s reasonable, Ms. Wagner said.

The bar has been raised now, she said. The entire industry is moving, because of litigation and regulation, to full transparency.

The Fidelity lawsuit, filed May 20 in a Massachusetts district court, is just one suit in a flurry of 401(k) litigation that has come to light in the past several months. One recent suit targeting the plan sponsor of a $9 million 401(k) plan could be a sign that this litigation won"t merely be relegated to the multibillion-dollar-plan market, but modestly sized plans as well.

That one really got my attention, Mr. Barstein said. If that [suit] happens, the floodgates are open.

The suit also comes as a new Labor Department regulation seeks to tamp down on unreasonable fees assessed to retirement investors. This conflict of interest rule, which takes effect in phases starting April 2017, will create fiduciaries of any adviser providing investment advice for a fee to retirement accounts such as 401(k)s and IRAs.

A Fidelity spokesman wasn"t able to provide an immediate comment.

Source: http://www.investmentnews.com/article/20160606/FREE/160609945/fidelity-401-k-lawsuit-could-up-ante-for-plan-advisers

Continue Reading ..

Fidelity's Timmer: Fed's 'Caution' Bullish for Stocks

While the Federal Reserve has dropped the word "patient" from its policy statement, all indications are that it will wait until at least September to begin raising interest rates.

And that's good for stocks, says Jurrien Timmer, director of global macro strategies at Fidelity Investments.

"I wasn't as comfortable six months ago, because the Fed seemed determined to go a certain route no matter what anybody said, but I think they are heeding the message of the market now and are erring more on the side of caution," he told the Financial Post.

"The Fed is getting the message. The gap between what the Fed was saying and what the market was saying has shrunk."

Many economists believe the Fed will indeed move on rates in September. The central bank has kept its federal funds rate at a record low of zero to 0.25 percent since December 2008.

The Fed's massive easing program has played a major role in the stock market's six-year bull run that has seen the S&P 500 index triple.

"Global easing continues unabated and in the context of a modestly positive economic backdrop, it should be bullish for risk assets," he noted.

Plenty of economists criticize the Federal Reserve for its massive easing program, saying it's raising the risk of asset bubbles without helping the economy much.

But Richard Salsman, president of InterMarket Forecasting, put his criticism in particularly colorful terms.

"Slowly but surely, the U.S. Federal Reserve has institutionalized a similar type of monetary fiscal prostitution" as Japan, he writes in a commentary. "The Eccles Building [the Fed's headquarters] in Washington, D.C. has become a mere marbled house of ill-repute."

Salsman sees no end to the Fed's low interest-rate policy. "The Fed will keep mimicking the low-rate policy launched by the Bank of Japan and keep the fed funds rate below 3 percent indefinitely," he states.

Many experts think the fed funds rate will top out at 2 percent for the next few years, a far cry from the 4 percent norm of recent history before the 2008 financial crisis.

Related Stories:

2015 Newsmax Finance. All rights reserved.

Source: http://www.newsmax.com/Finance/StreetTalk/Timmer-Fed-stocks-easing/2015/04/14/id/638380/

Continue Reading ..