Here’ another reason to love or hate the Department of Labor’s fiduciary rule (depending on one’s perspective). Reuters reports that the new standards it would set for 401(k) advisors could send $1 trillion in new assets to passive investment products.
The news service cites a Morningstar report released Friday that said such a fiduciary rule “would have broad impacts on brokerage firms, index companies and asset managers if more money moved into digital investment platforms and by changing behavior by financial advisors.”
Reuters notes it could be a boon for firms such as BlackRock, which manages index-based ETFs through its iShares brand, ETF provider State Street Corp. and MSCI, which builds indexes. But such a rule could have a “mixed effect” on other asset managers and distributors of financial products, Morningstar added.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of 401(k) Specialist and Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots. Experienced financial services content executive specializing in creative new media delivery. He joined the American Retirement Association in 2023 as Chief Content Officer, overseeing communications for the organization, as well as its sister organizations.