Stylus Workspace is a highly sophisticated tool, explains Schwartz, but the business of buying and selling funds has evolved to require more sophistication, even among retail investors.
“When we first heard that wholesalers were using our tools and research to market funds to advisors, I thought that there was no way it was going to work,” says Schwartz. “Advisors, however, were willing to go along with higher levels of sophistication, I was spectacularly wrong. They wanted help in explaining all of this stuff in-depth to their clients. That brings us to today, where retail sophistication is right on the heels of the institutions.”
Powered by over a quarter century of MPI’s fund analysis and factor modeling expertise, Stylus Workspace automatically applies to funds benchmarks, peer groups and factor models when a user selects them. In addition, users can run an individual fund against the full MPI Factor Model Library to identify the best set of factors for analysis for the fund.
Stylus Workspace includes institutional quality portfolio building tools and risk-testing functionality. The new updates also allow advisors to analyze funds with non-return economic data like interest rates to examine how products perform in different scenarios.
Schwartz says that fund buyers are putting extra emphasis on the ability to assess manager performance by economic factors, especially as more developed market central banks indicate that they’re moving towards adoption of tightening monetary policy.
“Institutional folks have been using econometric factors like GDP growth, volatility, spreads and rates for years,” says Schwartz. “Now we’re seeing a lot of our advisor clients producing content that shows a portfolio’s sensitivity to econometric or non-return risk factors.”