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Fund Companies Construct Advisor Websites

Mutual fund companies have increasingly been introducing special web sites for financial advisors to efficiently pass on to them product information, fund performance statistics and documents.

There were 64 funds with separate sites for financial advisors, according to a study conducted last July by McGladrey & Pullen, a New York-based consulting firm. At least three new sites and three revised sites, specifically for financial advisors, have been introduced since July. And the numbers will continue to grow, said Steve Miyao, director of mutual fund e-business for McGladrey & Pullen.

SAFECO Mutual Funds of Seattle, for example, whose adviser site was first launched in 1996, began offering a new service on Feb. 12. Advisors can now use the web page to chat live with a fund customer service representative, during business hours.

"It is an idea we got from our advisors and brokers who didn't want to deal with waiting for an e-mail to arrive the next day," said Mike Hillman, a regional sales manager for SAFECO. "They wanted an immediate response to their question."

The Evergreen Funds of Charlotte, N.C. plans to open its first-ever password-protected web site for professional financial advisors on April 23. It already opened an improved site for individual investors on April 1, said Chad Peterson, a company spokesperson.

The financial advisor web page will include everything that is available on the consumer site, plus several features just for advisors, such as a resource center, which provides market volatility reports, information on the Evergreen Funds' asset allocation program, product releases and commentary from Evergreen portfolio managers on changes in market conditions.

The advisor site also includes a broker/dealer service section, which has sales and marketing information, the names and addresses of wholesalers, online prospectuses and annual reports.

Clients can not make changes in their portfolios at the new consumer site because Evergreen is committed to using financial advisors and broker/dealers exclusively for its sales, Peterson said.

Load fund families that sell primarily through investment advisors and brokers tend to pursue a strategy similar to Evergreen's, said Andrew Guillette, a consultant for Cerulli Associates, a research firm in Boston. Such funds are reluctant to encourage direct sales via the Internet because it might send the message that they are willing to go around their primary sales channels.

Alliance Capital Management, a load-fund firm, also has a password-protected site for financial advisors. It includes information that has not been approved by NASD for individual investors but is useful for advisors and brokers, said Duff Ferguson, a company spokesperson.

Alliance's customer website allows investors to make changes to their portfolios but new purchases must be made through a broker or advisor, Ferguson said.

Alliance too is not interested in selling funds directly on the web because it does not want to threaten its existing sales channels, said Ferguson. It wants to encourage customers to invest in a variety of its funds, recommended to them by financial advisors.

But not all funds discourage direct sales. There are some no-load companies which court both the advisor channel and individual investors who want to buy funds directly.

For example, Westcore Funds, a family of nine no-load funds based in Denver, enables both investors and advisors to make changes to accounts via the web.

"We have a pretty large number of investors who use advisors, but also a good number of direct purchasers. We're trying to satisfy both of these groups," said Tami Hollingsworth, new media specialist at Westcore.

SAFECO also offers account access to both advisors and investors, and advisors have expressed concern about this, Hillman said. But the firm has had strong sales through advisors from mutual fund wrap accounts. Most of SAFECO's direct transactions on the Internet have come from people with relatively small accounts. Investors with $100,000 or more are not using the web, said Hillman.

In general, advisor sites are offering ever more services. The Westcore advisor site was first launched about a year and a half ago, but was reopened as a password-only site on March 5, Hollingsworth said. The new site now offers a wide variety of documents that can be downloaded. These include Powerpoint files that advisors can use to make sales presentations. It also has links to financial news sites.

Westcore's advisor site had not previously been password protected because it did not contain much information specifically targeted to advisors, Hollingsworth said. The earlier site had three basic components - performance information, commentary from portfolio managers and e-mail and fax alerts to advisors on news from the company.

Nvest, L.P. of Boston, a holding company with 17 affiliates, launched an advisor-only site on March 22 of this year. The company says the site provides, "one stop shopping" for information on a number of funds, said Scott Frisch, vice president of Nvest Advisor Services.

At the site, financial advisors can obtain information on Nvest's six mutual fund affiliates: Oakmark, Loomis Sayles, Delafield, Back Bay Advisors, New England and Jurika & Voyles. The site includes daily fund performance statistics, comments from portfolio managers, marketing materials and prospectuses that can be downloaded.