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How ProFUNDity Can Help Actively Managed Funds Increase Market Share

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ProFUNDityTM

prohFUND-i-tee

plural: ProFUNDitiesTM

noun

  1. The qualityof showing a clear and thorough understanding and ability to provide thoughtful and timely insight in all communications with financial advisors and investors regarding mutual funds, ETFs, hedge funds, and closed-end funds.

Prospective clients were swayed by the simplicity and ProFUNDityTM of the portfolio manager’s message.

  1. A statement or idea that shows great knowledge and experience in presenting highly specialized and often complex information on investing in layman’s terms.

ProFUNDityTM was readily apparent in the audience’s high level of understanding because of clarity and precision of presentation.

Synonyms: wisdom, intelligence, depth, perspicuity, discernment.

Comfort and Trust

There’s a reason People is ranked among the world’s 10 most popular magazines, reaching 88 million consumers, and is read by more affluent adults than any weekly publication in America.

It’s about people.

Whenever a survey asks financial advisors to list what they want most from internal and external wholesalers, access to portfolio managers is at or near the top. Why?

Clients can’t talk to a spreadsheet.

Despite the fact robo-advisors have made strides in recent years, investors prefer people to Siri or Alexa when it comes to managing money.

It’s all about the comfort and trust a human touch can provide.

ProFUNDityTM – A Unique Edge for Active Managers

When it comes to writing stories about investment management, the media craves predictions, insightful opinion, and pithy sound bites. Since actively managed exchange-traded funds represent less than 3% of the overall assets under management in U.S.-based ETFs, there will always be media interest in speaking with successful mutual fund PMs at firms that need to position and promote brand identity in a fiercely competitive market.

Years ago, the PMs of 4- and 5-star funds used to be the true rock stars at the annual Morningstar Investment Conference in Chicago. Financial advisors, investors, and the media would crowd their way into jammed conference rooms to hear the latest and greatest pearls of wisdom on everything from small-cap value stocks to the best opportunities in emerging and frontier markets.

Attending the Morningstar Conference was like going to a money manager’s version of the Westminster Dog Show.

Only the best of breed was on display.

Related: The Most Powerful Force in the Investment Universe

Filling a Need

Morningstar has changed its conference content and format in recent years. Attendees now hear more about investor psychology, practice management, and analytics than pure investment ideas from panel after panel of PMs. Morningstar has become a much bigger player in managing client money and will open this year’s conference with their own best investment ideas for funds and individual stocks.

This evolution has opened the door for fund companies to gain attention by sending PMs for interviews with enterprising reporters looking for a fresh angle while being a captive audience of the conference agenda.

The 15+ years I served as a wire service reporter and newspaper executive editor taught me first-hand how the media thinks. That knowledge, combined with 20+ years of experience working with hundreds of investment professionals at major fund companies, has helped me craft core messaging, create content, and develop compelling story angles for the media with a distinct brand of thought leadership called ProFUNDityTM.

A Successful Time-Tested PR Strategy

Here’s how ProFUNDityTM fits in a three-part PR formula to help actively managed funds increase market share:

Performance + ProFUNDityTM + PR = Personification/Growth of AUM

Let’s take a look at each aspect.

  • Given the level of influence Morningstar’s star ratings have with financial advisors and investors, the media wants to hear from 4- and 5-star portfolio managers. That covers the top 32.5% of all funds in a Morningstar category based on risk-adjusted returns.

Simply put, the magnetic power a 4- or 5-star rating has to attract the attention of advisors and investors also works in terms of attracting readers and viewers. And the media knows it.

  • ProFUNDityTM. The shopworn term ‘thought leadership’ has given way to a higher standard as it applies to promoting mutual fund brand identity. White papers with colorful pie charts and fancy fever charts once considered de rigueur in the fund industry have become passé.

This is where teamwork on content creation comes into play. Investment professionals know what to say, and they benefit from a media veteran and fund communications professional who can help them say it. An expert can take information and transform it into a remark or statement that shows deep knowledge or insight into a particular area of expertise. ProFUNDityTM underscores the impact of top-decile performance.

  • There’s a reason TV networks hire former pro athletes to be color analysts. They’ve worn the uniform. They’ve played the game at its highest levels. The same is true for PR experts. Having a college degree and agency experience is one thing; having a combination of on-the-field media experience and in-the-trenches work with mutual fund investment professionals is another.

Such cards as top-tier performance and best-of-class insight are best played by a PR practitioner who’s had a seat at the table and can provide value when it comes to playing the best hand, whether with the media, financial advisors, or investors.

Call to Action

Whether it’s before, during, or after the annual Morningstar Conference in Chicago on May 8-10, successful active managers have the opportunity to use personification and ProFUNDityTM to gain visibility, grow assets, and increase market share by doing something 97% of ETFs can’t.

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