TEAM MODERNIST ON Bob Dylan, Fiduciary Standard, and Market News

We believe in educating you to feel ease in your financial decision-making. This month, we put on our academic caps to introduce the first edition of Modernist University™.

We hope you enjoy! 

Modernist University™ on fiduciary duty in the financial industry

We’re excited that a year from now, the US Department of Labor will require more financial advisors to act as fiduciaries, i.e. put their clients’ interests before their own. Though DoL received push-back on this consumer protection, we view this as a big win for everyday people already struggling to prepare for retirement.

Under the new rule, financial professionals who give advice on retirement accounts such as IRAs & 401(k)s will be required to declare their reasons for recommending commission fees (often opaque and more expensive) over flat or percentage fees (easier to understand). Taxable brokerage accounts will be unaffected.

As a Registered Investment Advisor, all of Modernist’s work already complies with the fiduciary standard. In the future, we hope to see a uniform fiduciary requirement for the entire financial industry!

If you’d like more information about fiduciary duty and compensation models in the financial industry, check out our FYI page:

Songs that are really about money

We realize that Bob Dylan was probably notwriting “Positively 4th Street” about an ex-financial advisor when he penned this heartfelt song of betrayal. Yet his sentiments are likely familiar to anybody who has encountered an unscrupulous professional.

We hope that recent moves towards increased consumer protection will align more professionals’ decisions with the needs of their clients and remove the possibility of conflict of interest.

Updates from the investment committee

Every quarter has its fair share of alarmist media headlines. Yet Q1 2016 may have taken the cake with a pronouncement from the Royal Bank of Scotland on February 11 urging investors to “Sell Everything!” It also happens that February 11 was the low point for the quarter and the market has rallied by double digits since that day.*

In this 12-minute Making Sense of Markets Q1 presentation, our Portfolio Strategy Team discusses what happened last quarter, shares timely and timeless insights on markets and reminds us of the importance of a long-term perspective.

Click here to watch Making Sense of Markets Q1 2016 or here to read our Investment Committee Briefing.

Around town

Spring is finally here and that means cycling season! If you are a bit rusty on your bike maintenance skills, you can pop by PSU for a refresher: $5 Basic bike maintenance class every Monday at PSU bike hub.