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Being agreeable, I began working my way through it. I was 11% done, according to the built-in monitor, when I reached a question on the order of "are you an investment advisor or other financial services professional?" When I clicked "no," I was suddenly 100% done.We are continually looking for ways to improve Morningstar.com. To help us do that, please complete this online survey by Friday, August 16th. The survey should take about 25 to 30 minutes to complete, and is completely confidential. Your insight and feedback are very important to us. Thank you for your help!
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What is more jarring to me, to use your words, is when we will finally realize, "clients" whether of M* or Goldman Sachs are "lemmings" and this view is endorsed by the collective interpretation of the financial industry of "capitalism". Or dare I say "objectivism", because that's what I think this is. The view that "what is good for ME is good for others".
As "clients", all we should expect and receive are services for the money we pay and then WE decide whether what we receive is good, bad and use as we deem fit. I don't need to see M* rating to tell me a fund is "good". i can see it easily based on criteria important to ME. M* criteria were not invented to help me. They were invented to help fund industry market their wares. The "Great Owl Rating" is for ME. And let me tell you, this is going to eat into M* revenues big time.
I never opt-in for "help us improve our software" notices from Firefox and Microsoft either because the cynical old bastard I have been developing into over the years, I just KNOW nothing about it is actually going to benefit ME in any way, but will ONLY benefit Firefox or Microsoft. Let's be like them. Ask "WTF is there in it for me" for once.
FWIW, Derf
On the other side of the ledger, I have nothing but praise for T. Rowe Price. I have twice (over the past two decades) participated in focus groups for them. The first one was to help them redesign their website. What they ultimately came out with was, IMHO, a disaster - too many overlays, pop ups, etc. The kindest thing I can say about it is that it was better than Vanguard's at the time. But it did reflect some of the feedback they were getting, and I had the sense that they did take the comments from retail, individual, end users seriously.
The second was a longer term discussion group, where they poked (suggested conversations) about a variety of topics (not all strictly investment or even finacial-oriented); they encouraged us to add our own discussions; they also sought specific feedback on a particular aspect of their website. They showed it to us as a work in progress, and demonstrated how they incorporated some of our ideas. To the very last person who commented on their process, each of us felt respected, listened-to, and appreciated.
I have always felt that TRP was a good money management company. But these experiences did more than anything else to convince me that they are one of the "good guys". There really are some out there.
I'll be darned! You DO have a sense of humor after all!!
Same way as M* is "always right". I periodically lookup how WWWFX is doing. One fund what was vilified by M* no end. It always seems to be doing well within its peer group. Needless to say, as M* always does, it simply stopped commenting on it. They figure no one will remember. Sad thing is they are mostly right about that part.
Perhaps they are trying to be more useful for Financial advisors etc. or perhaps they have collected enough feedback from average Joe user.
At least you weren't kicked out at 50% done, etc. I occasionally participate in remunerated surveys in my profession and find they collect a lot of data before they expell me. Obviously, I only start one now when I have little else to do, and it's infrequent. In this data age, almost anything you enter can be tabulated and used. (I'm hoping for one directed at left-handed, red-haired hermaphrodites - oops, too much info)
It's the perpetually late-to-publication quarterly update page at AQR Funds:
Note the little locked icons denoting adivsor resources only info. Can you believe?
Honestly, I've sat through presentations marked "advisor use only...not for release to public" only to see the very same charts show-up elsewhere on-line during one interview or commentary or another.
I'll chalk it to the falsehood of perceived elitism through exclusion. Practiced all-around us, of course, but I'm discovering this business perpetuates it like an elixir.
Fund investing is a game for a group that marketers call "the mass affluent," about 10% of the population representing income percentiles 89 - 98. They have enough money to invest to be interesting to financial services firms ($50k - $250k) but not enough to demand individualized attention. The folks in percentile 99 - 99.5 are rich but not ridiculously so. Doctors, lawyers, successful small business owners - incomes in the $300 - 400k range and investments a bit north of $1M. Hard-working folks, well-educated who still have reason to worry about their future. On whole, worth some considerable personal attention. You don't really get into the Northern Trust crowd until you're above 99.8 where net worth is well over $5M.
Fund companies need the mass affluent and have concluded, rightly I suspect, that the most efficient way to reach them is through planners and other advisors.
I don't at all object to Morningstar doing specialized surveys of such professionals; it makes fine business sense. I'm mostly irked at the shoddy representation at the outset of the survey. I run Augustana's Institutional Review Board, the folks charged to guaranteeing the safety of human research subjects (including those being variously surveyed) and the first rule of protection is informed consent. From the first sentence on, researchers must be open about what exactly they're asking about and how the information's going to be used. If you decide that folks don't need to be told what you're going to do and why until the research is partway complete, your research is DOA.
From our perspective, Morningstar had an ethical obligation to disclose what they were up to so you could make an informed choice about whether to participate. They didn't.
As ever,
David
This kind of survey is done rather frequently in my industry, and I often get part-way in and then get a message that they have already fillde up their quota of people like me. They use questions like specific job description, assets under management, age group, etc. Rest assured whomever hired the survey company has certain target markets in mind.
Must admit I am surprised that M* did not disclose right up front that the survey was for advisors only. Pretty tactless, it seems to me.
The easiest way to comply is not to make the information available to investors. And when money managers do solicit investors directly, they put in the extra work to package it according to regulation, and pass it by their lawyers.
Or ...
https://www.law.columbia.edu/center_program/corp_gov/corp_govwrit
Here's Reg FD. See, in the Definitions section, the definition of Issuer (§ 243.101(b)). It explicitly excludes investment companies (mutual funds), except that closed-end funds are covered by the regulation.
So selective disclosure by (open ended) funds is not illegal. Why? Good lobbying?
Pretty much what David said.
I'm not particularly bothered by late quarterly reports. Rarely do managers ever go into detail about the how/why of mistakes and quarterly reports rarely seem to offer THAT much detail/insight.
Maybe I'd feel different if I were investing in a hedge fund. But maybe not. In any case, if you give the expectation of providing quarterlies, I think it's important to be timely. Else, make them semi-annual, or annual. Whatever the period, not following through reflects poorly on management.
As for the details in letters, presentations, interviews and quarterlies...I'm certainly looking for it. Trying to see through window dressing. Earnestly noting things that worked, things that didn't. Changes in strategies. Allocation shifts.
I think several managers provide this kind of detail, no? Seems to me that the folks at Whitebox, for example, put themselves out there.