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1) Ameriprise Financial to Acquire BMO’s EMEA Asset Management Business

Ameriprise  |  4/12/2021

Because… According to Ameriprise’s year-end 2020 financial reports, its total net revenues decreased 8% from 2019 to 2020, and its net income fell 19% during the same one-year period. The acquisition will add $124 billion of BMO assets to Ameriprise’s business in Europe, the Middle East and Africa (EMEA), bringing Ameriprise’s total assets under management and administration to more than $1.2 trillion. Columbia Threadneedle, in particular, will benefit from the deal. First, it will boost the company’s presence in the region, with assets increasing to 40% of Columbia Threadneedle’s post-acquisition total of $671 billion. Second, Columbia Threadneedle can enhance its investment strategies in EMEA by absorbing BMO’s talent and adding key capabilities in responsible investment, liability-driven investing, fiduciary management, and European real estate. Third, Columbia Threadneedle will gain an additional distribution avenue as BMO’s North American Wealth Management clients will have access to its investment management solutions. Fourth, Columbia Threadneedle will have a chance to acquire assets from some BMO asset management clients.

2) Managed Accounts Are Particularly Beneficial for Near-Retirees

Plansponsor  |  4/12/2021

Because… Besides what plan sponsors need to do to win over their employees, managed account providers should improve their services if they want more plan participants to embrace managed account offerings. Enhancing transparency is one of the keys to a higher adoption rate. Managed account providers have the responsibility to share performance and fee information with plan sponsors and participants on a regular basis. Most individual investors pay a great deal of attention to this type of information, so product providers willing to supply necessary data will gain investor trust. Managed account providers should also explain what factors are taken into consideration to create retirement savings plans and determine asset allocation. Since there is no standard approach, plan participants are eager to know exactly how investment professionals can help them, including what underlying products are used, how portfolios reduce risks and volatility in an uncertain market environment, and whether the advice includes retirement income withdrawal solutions.

3) Bitcoin ETF Drumbeat Gets Louder as Eight Issuers File with SEC

Bloomberg  |  4/14/2021

Because… With bitcoin’s price hitting an all-time high of $63,000 and Coinbase, the world’s largest crypto exchange, going public via a direct listing, enthusiasm for bitcoin ETFs is being built up. Bitcoin has reached a $1 trillion market cap in 12 years, becoming the fastest asset to hit the milestone. In comparison, it took Apple 42 years, Amazon 24 years, and Google 21 years to achieve the same goal. The cryptocurrency gained more than $500 billion since the beginning of this year. The Canada-listed Purpose Bitcoin ETF, which claims to be the world’s first bitcoin ETF, has amassed $1.1 billion of assets since its inception on February 18. Despite a structural limitation that comes with a closed-end trust, Grayscale Bitcoin Trust (GBTC) already had $40.5 billion of assets as of April 13, 2021, up from $14.5 billion as of 2020 and $1.9 billion at the end of 2019. Such rapid asset growth indicates strong investor demand for bitcoin investment products, which may impel the SEC to reconsider their stance.