Clients Prize ‘Tried and Tested’ Firms, Says Broadridge Study

“Tried and tested” could be the overall theme of the 12th annual Fund Brand 50 Report, for 2023, from fintech firm Broadridge Financial Solutions.  

The stalwarts that led Broadridge’s top 10 are BlackRock Inc., which came in first, and The Vanguard Group, Inc., which placed second in the top 10 list. They are also respectively the world’s No. 1 and No. 2 exchange-traded fund issuers.  

Capital Group came in third, while the four through seven rankings went to Fidelity Investments, J.P. Morgan Asset Management, Pimco and T. Rowe Price, respectively, all of which maintained their spots from last year.  

“U.S. fund buyers sought the security of tried-and-tested products with regular income components and low risk, while displaying a preference for established brands with a proven track record of high performance,” Jeff Tjornehoj, Broadridge’s senior director of distribution insights, said in a statement. 

Both Franklin Templeton Investments and Dimensional Fund Advisors moved up one level, while the Goldman Sachs Group, at the 10th slot this year, dropped two rungs. The maintenance of the status quo in the top seven firms follows a series of market swings over the past few years that found investors seeking stability.  

Survey respondents named an “appealing investment strategy” as the most important brand attribute, followed by “solidity” as the second-most important for two years in a row.  

Rounding out the most-prized traits with respondents are “knowledge and understanding of the market,” “client-oriented thinking” and “having expertise in what they do.”  

Considering their strong growth, it’s unsurprising that offering ETFs “proved a differentiator, particularly as they marked firms out as innovative and able to adapt quickly to new market realities.”  

It’s not surprising that ETFs are popular with investors due to their transparency of fees and portfolios, and that offering them gave asset managers a leg-up against competitors. Direct investing technology is a “must-have function, as major asset managers jockey for position with financial advisors,” according to the study. 

“Asset managers jostled to differentiate themselves by developing their product offering and increasing transparency,” added Tjounehog. “But the overall effect was something of a closed shop, as fund selectors doubled down and largely kept their business where it was.” 

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