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 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.