Consolidation—A Win-Win-Win Proposition

Issue 9 - September 2009

Today, many investment professionals still conduct direct mutual fund business (or “check and app”)—a process that generally fails to optimize efficiency. Years ago, there were compelling reasons to conduct business directly with mutual fund companies—it was a simple and an easy way to grow mutual fund business. Historically, fund companies offered a much larger selection of fund options than the average brokerage platform, plus it made accounts portable if an investment professional decided to switch firms.

From a servicing perspective, direct mutual fund business also enabled financial institutions to reduce client service demands on themselves and their investment professionals by placing this responsibility on the fund companies.

However, recent studies have revealed that consolidating mutual fund assets through a brokerage platform provides distinct advantages that can help you simplify your day-to-day activities, freeing up the time you need to continue to grow your business. While enabling you to manage your accounts with more control and efficiency, a centralized platform offers access to a wide variety of fund families allowing you to build tailored, targeted client portfolios.

Also consider that a flexible brokerage platform offers access to a depth of investment products and services that can enhance your ability to cross-sell. Additionally, it is likely that your clients are currently receiving communications from several different mutual fund families at many different times. The consolidated model enables you to control the touch-points and interactions with your clients in order to deliver better service. Further, on a consolidated mutual fund platform, client assets are aggregated for breakpoint calculations. This may provide your clients with reduced fees. Together, these benefits can help you build deeper, more loyal client relationships.

More and more, investment professionals have been opting to consolidate their directly held mutual fund business.

Partnering with an industry leader, like Pershing, can help you with the consolidation process. With a history spanning 70 years, the depth of Pershing’s resources is unparalleled. The platform offers access to a vast network of over 16,500 mutual funds from more than 500 fund families, including 3,000 no-transaction-fee options. You can also take advantage of Pershing’s operational support and technology, like NetX360™, that give you the tools you need to select funds and other investments that are best matched to your clients objective, develop, manage and monitor financial plans, activities and proposals. Your clients have day and night access to consolidated account information via your firm’s website or NetExchange Client®, as well as via telephone. Pershing can even provide you and your home office with an action plan that will prepare you for and guide you through the process.

Consolidating your clients’ directly held mutual fund assets—and consolidating them with Pershing— provides many benefits to all parties. It is a win-win-win proposition. Contact your home office today to find out how you can take advantage of mutual fund consolidation.

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