Monday morning briefing – January 14, 2019
Bank and fintech partnerships took a big step forward in 2018. Expected trends for the hedge fund industry in 2019. How to improve the customer experience during digital onboarding. Here’s what matters to millionaires’ children. And much more in this week’s briefing.
Economic/industry news
International Economic Data Snapshot – includes aggregated data of the worldwide economy: Snapshot: International economic data
U.S. inflation rate falls to 1.9% in December: US consumer prices drop for the first time in nine months
The Bank of Canada maintains its benchmark rate at 1.75%: Bank of Canada holds steady as oil slump kills urgency for hike path
The U.S. Federal Reserve Board can take its time with future rate increases: Fed can be ‘patient and flexible’ with rate policy: Powell
Proposal on risk ratings for alternative investments: AIMA, CAIA propose new risk ratings for alternatives
Seeking more ESG fixed income solutions: Advisors say they want more ESG fixed-income options
Fitch to produce data showing how ESG factors affect a companies’ credit rating: Fitch Ratings launches ESG relevance scores to show impact of ESG on credit
RBC and BlackRock to partner in ETF offerings: RBC iShares is now Canada’s largest ETF provider
Regal Assets enters Canada: US alternative investment firm makes Canadian debut
Could ETFs cause systemic risks in a market downturn?: Bear market may increase risks in ETF sector
On the pulse – New frontiers in fintech
Bank and fintech partnerships took a big step forward in 2018: 2018: The year that banks and fintech started to figure things out
TD introduces Clari to its mobile app users: TD integrates chatbot into app
With the payments industry expected to grow, here is how AI can help: How will artificial intelligence ultimately benefit the financial services sector?
Revenues from robotic process automation in banking expected to grow by over 400% by 2023: Robotic process automation revenues in banking and financial services to reach $1.2bn by 2023
Financial services executives believe that big tech companies could enter the retail banking space: Two-thirds of financial decision-makers believe tech giants will offer retail banking in five years
Here is what could be in store for the payments industry in 2019: It’s all about convenience: the payments industry in 2019
The trends you need to know in wealthtech: Wealthtech trends to watch in 2019
The U.S. is falling behind in financial services technology: The US is losing the AI, blockchain & fintech arms race (but is crypto-friendly)
Understanding digital transformation: What is digital transformation in business: Everything you need to know
How to improve the customer experience during digital onboarding: Digital customer onboarding – are you doing it wrong?
Digital transformation slow for financial services firms: Digital transformation challenges firms: survey
Some cryptocurrency predictions for 2019: Crypto forecasts for 2019
News and notes (U.S.)
A look at the hedge fund industry in December: State of the industry – December, 2018
Hedge funds’ performance weak in December: Hedge funds down 0.82 per cent in December
A look at hedge fund winners & losers in 2018 (video): Hedge fund winners and losers in 2018
Expected trends for the hedge fund industry in 2019: Top hedge fund industry trends for 2019
Jeff Vinik to reopen hedge fund: Investing titan Jeff Vinik to reopen hedge fund: ‘The fire in my belly still burns’
Pershing Square starts 2019 strong: Ackman’s Pershing Square fund powers ahead in new year
Private equity year in review: 2018 in review: Top 5 global PE deals, exits & funds
Just over $130 billion was invested in VC deals in 2018: Venture capital investing soared to a record in 2018
Bitwise submits application for bitcoin ETF: Bitwise hopes to crack SEC code with proposed bitcoin ETF
U.S. money market funds gaining assets amid market volatility: U.S. money fund assets rise above $3 trillion for the first time since 2010
Predicting U.S. stock performance: The 30-year outlook for U.S. stocks
High-net-worth topics
Here is what is important to millionaires’ children: What the children of millionaires value most
Why a market-neutral strategy could work in the current market environment: Is it time to put your investments in neutral?
For the high-net-worth, consider these asset protection strategies: Asset protection of high net worth individuals
Polls & surveys – What financials are saying
Higher rates and volatile markets will affect Canadian’s wealth in 2019 (RBC): Expect wealth creation, homeownership challenges in 2019: RBC
Advisors should take some time to discuss bear markets with their clients (Hartford): Warning to advisors: Your clients don’t always listen to you
49% of Canadians do not have any emergency savings (Refresh Financial): 53% of Canadians live paycheque to paycheque
Women are worried about not having enough money for retirement expenses (HSBC): Women more worried about financial security in retirement than men: survey
For financial marketing and investment commentary help, contact us at 1.844.243.1830 or info@ext-marketing.com.
Flipping the script on investment commentaries
It’s as inevitable as the changing of the seasons: the return of commentaries for most investment managers. Commentaries tend to result from sales and/or regulatory obligations, and are often viewed as a bit of a distraction when compared to an investment manager’s other core responsibilities.
Just a few small changes, however, can increase the value of the commentaries you produce for your audience, regardless of whether that audience is individual investors, institutional investors or other stakeholders.
Remember your audience
While you may be writing for an investor audience, a significant portion of your readership will likely be made up of industry insiders, including other investment managers, institutional gatekeepers, financial journalists and regulators. While keeping the language plain and straightforward, ensure the commentary is high quality and sufficiently detailed.
Identify and avoid obscurity
Whether you’re writing for an investor-level audience, a professional investor audience, or both, clarity of argument is important. Avoid confusing words and phrases (e.g., “contributed negatively to performance”) and avoid sentences that are longer than 50 words.
Avoid information overdose
Investment communications should be about clarity and relaying important information.
There are very few good reasons for an investment commentary to be more than 2,000 words, even for multi-asset or multi-strategy portfolios. Past macroeconomic and market discussion is essential to laying the groundwork, attribution and trading activity is important to explain what happened over the period and why, and an outlook helps investors focus on the future. Just make sure you are being concise.
Look for teachable moments
In today’s increasingly complex investment world, insider jargon is sometimes unavoidable, even for investor-facing commentaries.
Discussing portfolio alpha and beta, for example, may be essential for certain investment strategies. Mentioning yield curves, duration and spreads is often unavoidable in fixed income commentaries. Instead of either avoiding those terms or using them without context, have a short, standard definition ready for widely used terms, to insert into commentaries (even in parentheses).
It’s one thing for your investors to be informed, it’s another for them to walk away from your commentaries having learned something. Done correctly, this is where your commentaries can rise above others and become a hub for valued information.
Looking to offload more of your investment commentary tasks to an industry leader in the field? Contact us today to learn more at 1.844.243.1830 or info@ext-marketing.com.
Your investment commentary playbook: tips to make reporting easier
Investment commentary production can be a chore.
But there’s one great thing about this business function: it usually follows a fairly predictable pattern. Meaning, it can be made easier if you build some additional preparation into your project plan before it kicks into high gear.
Here are some key tasks and milestones to make your commentary production process a smoother ride:
Style
Does your organization have a preferred style guide (i.e., a reference document that tells you, for example, whether you write “U.S. dollar” or “US dollar”)? Or does your existing style guide need to be updated to reflect new and/or newly accepted financial terminology?
Ensure that style guides are approved before period end to reduce uncertainty during your commentary cycle.
Macro and micro planning
It’s great to track the statuses and due dates of each individual deliverable but don’t forget to create a master schedule, even something as broad as a traditional monthly calendar view.
This can be especially helpful when dealing with unexpected mid-cycle events, like any new requirements that pop up in the middle of your production cycle. The trick is to be nimble day to day, while not losing sight of longer-term deadlines.
Timeframes
It’s not uncommon for a single investment mandate to have multiple investment commentary requirements for delivery at the same time because of multiple reporting time periods (e.g., a monthly, quarterly and/or rolling annual commentary for one mutual fund).
Always check and re-check the time period requirements of the commentaries you’re working on. This may seem like common sense, but it is often overlooked.
Know your roles
A single investment commentary often requires inputs from multiple sources. Benchmark data may come from your analytics group, performance information may come from a data provider, investment outlook may come from the portfolio manager, and so forth.
A cross-functional meeting of stakeholders before the live cycle reminds the team that commentary season is coming up, and ensure everyone is aware of responsibilities and deadlines.
Communications calendar
If you utilize a broad range of communications resources (e.g., writers, editors, typesetters and designers), make sure those individual resources are captured in either your master calendar or a separate one. This makes resource allocation easier, both before and during your live cycle, and help you re-allocate resources to deal with unexpected events.
Make your investment commentary process easier. Contact us at 416.925.1700, 1.844.243.1830 or info@ext-marketing.com.
Top tips for delivering your portfolio manager commentaries faster
Having worked on tens of thousands of portfolio manager commentaries over the past decade, our firm has developed a number of best practices for producing commentaries better and faster than anyone else.
Here are some great tips we recommend you try before your next commentary run (and there’s always a commentary run around the corner).
Have all the info you need handy
A spreadsheet with full fund & portfolio manager/sub-advisor names, up-to-date benchmark(s), attribution info, etc. should be maintained throughout the year. Having all this information is key to producing commentaries faster.
Ensure you have a complete understanding of commentary needs
Knowing details like the number of commentaries, the word count for each and the audience (i.e., retail, advisor, institutional) will help you get prepared for the next run, including your staffing and training needs.
Speaking of staffing
It’s a good idea to know exactly how many people you’re going to need to help get things done. This can include internal and external writers, editors and project managers, as well as anyone you’ll need for reviews and approvals.
Prepare a well-thought-out and achievable workback schedule
This is a key component to ensuring requests go out, due dates are maintained and required approvals can be managed.
Notify the portfolio manager or sub-advisor of dates/needs
They may have a vacation coming up and/or manage a number of different mandates. Let them know exactly what you’ll need from them and when, as early as possible so they can manage all their deliverables.
Keep a running style guide that includes grammatical & wording preferences
Make sure the entire team has access to this style guide so they can refer back to it often. This ensures that no matter how many people are working on your commentaries, everyone is singing from the same song sheet.
Know what compliance is looking for
This knowledge will help you avoid having to spend lots of time adding required content and/or removing offending language. Any feedback or direction you receive can be added into your running style guide.
Find common ground
When allowable, it can help to recycle information within different fund commentaries. A good example is reusing some macroeconomic information for similar geographic regions, asset classes, etc. You can save time and money by not having five different writers say that the Fed raised interest rates during the period.
Ext. Marketing Inc. is the global leader in the production of portfolio manager commentaries. In fact, the ext. team produced over 1,500 unique monthly, quarterly, semi-annual and annual portfolio manager commentaries for our global clients in the financials space in July 2018 alone.
Need help producing better, faster commentaries? Contact us today at info@ext-marketing.com.
Monday morning briefing – November 26. 2018
The names you need to know in fintech. Activist investors in Europe keying in on the U.K. industrials sector. Why states around the world should consider issuing cryptocurrencies supported by their central bank. And much more in this week’s briefing.
Economic/industry news
International Economic Data Snapshot – includes aggregated data of the worldwide economy: Snapshot: International economic data
Canada’s inflation rate rises again:Canada inflation ticks up, central bank seen keeping rates steady
Japan’s economy contracts in the third quarter: Japan GDP: Natural disasters hit economic growth
Could there be changes to the BoC’s mandate to keep prices stable?: Bank of Canada plans thorough review of inflation targeting
Protecting your portfolio against the next recession: The next recession is coming: Here’s how to protect your portfolio
A look at the currency market: How currency differs from other asset classes
Canadian ETF assets fell in October: Canadian ETF assets lower in October
The number of distinct indexes rose by 12% in 2018: Number of indexes on the rise, led by fixed income: report
Sir Ronald Cohen on the importance and outlook for impact investing: Impact investing: A multitrillion-dollar market in the making
Businesses should focus on the new, “circular economy”: ING Portfolio focuses on financing for sustainable economy
On the pulse – New frontiers in fintech
Fully transitioning to digital is much more than just a mobile app: Are you really ‘doing digital’?
Customer centricity vital for the banks of the future: It pays to be personalised
How to manage your cloud infrastructure: Managing cloud infrastructure post-migration – a CTO guide
The names you need to know in fintech: Fintech finance’s power players
Technology could help private bankers become more productive: Making private bankers more productive
Open banking not well known or understood by end consumers: Open banking slow burn means just 22% of consumers have heard of the concept
Starling Bank launches Client Money Accounts, helping professional practices that hold money on behalf of their clients: Starling Bank launches CASS-compliant accounts helping firms manage third-party funds
Regtech will be an important component for the future success of financial institutions: Saxo Bank on why regtech is key to scalability in financial services
How to be innovative in the insurance industry: How to become an innovator in insurtech
Capital One purchases WikiBuy: Capital One buys online shopping comparison startup
Many firms don’t believe that they are resilient enough to combat cyberattacks: Cyber security implementation: firms want it, but less do it, finds survey
BitSpread launches BitSpread Financial Solutions, designed for investing in blockchain assets: BitSpread launches new financial solutions division
Why states around the world should consider issuing cryptocurrencies supported by their central bank: IMF: Nations need to consider a central bank backed cryptocurrency
Cryptocurrencies may not be banned in India: A ray of hope for cryptocurrencies as India readies draft regulations
News and notes (U.S.)
The Barclay CTA Index fell in October: Barclay CTA Index loses 1.29 per cent in October
Hedge fund assets fell to $3.06 trillion in September: Hedge funds redemptions surge to $39.1 billion in September, highest in more than 5 years
Management expenses no longer a tax break for hedge fund investors: Hedge fund investors lose key tax break for management expenses
Activist investors in Europe keying in on the U.K. industrials sector: Industrials are No1 target sector for activist investors in Europe
Secondaries still generating a lot of interest: Why secondaries fundraising is surging
Morgan Stanley launches new advisory platform, WealthDesk: Morgan Stanley unveils new advisory platform
AllianceBernstein to purchase Autonomous Research: AllianceBernstein announces offer to acquire Autonomous Research
Further trade tensions between the U.S. and China could hurt the stock market: Expect more stock market losses if US-China trade war worsens
Long-term funds experienced $29.1 billion of outflows in October: Morningstar: Passive equity funds gain, actives lose big
An interview with Abigail Johnson and Kathleen Murphy of Fidelity: The most powerful woman in fund management gives a rare interview
High-net-worth topics
High-net-worth investors expect further equity market declines: The equity party’s ending, say wealthy investors
How Tiger 21 helps the ultra-rich: Tiger 21 philosophy: Learn from your (very wealthy) peers
Life insurance can help reduce estate taxes, but not eliminate taxes entirely: Can HNW clients still use life insurance as a tax and financial tool?
Polls & surveys – What financials are saying
Canadian investors have trouble understanding the concept of risk and return (Natixis): Investors may have an unrealistic understanding of risk and return: survey
Over the next 25 years, $68 trillion of wealth will be passed on to younger generations (Cerulli): Generational wealth transfer to hit $68 trillion over 25 years: Cerulli
Correlating share value with ESG ratings (MSCI): Are ESG ratings the new credit rating for stock prices?
For financial marketing and investment commentary help, contact us at 1.844.243.1830 or info@ext-marketing.com.
What makes a great portfolio manager commentary?
We’ve written and edited tens of thousands of portfolio manager commentaries over the years, as well as portfolio manager podcasts and videos, so we have a pretty good handle on what elements are required to produce a great commentary. Here are some items we feel are important components of a well-crafted commentary.
A well-written, relevant macroeconomic review
The macroeconomic portion of a commentary should provide details of the economic events and factors that may have impacted the performance of your fund during the period. Additionally, it should be relevant to the fund’s category.
For instance, if you are writing about a U.S. equity fund, the macroeconomic review should predominantly be about the U.S. economy – including any moves by the U.S. Federal Reserve Board, economic figures, as well as the performance of relevant sectors. You can refer to the performance of individual companies, but that type of information is usually best contained in the attribution section of your commentary.
Attribution information: contributors, detractors and the “whys”
This is where you list contributors to – and detractors from – the fund’s performance. This information could be broken down by sector, geography and/or individual security. To keep this section easy to understand, we generally like to list contributors to performance in one paragraph and detractors from performance in another.
It’s important that you explain why these holdings performed the way they did. This gives investors important insights into the factors behind the performance of underlying holdings. Without these reasons, all you’re doing is regurgitating the fund’s attribution report, which provides little value to the end investor.
The fund’s positioning … and the reasons behind this positioning
With advisors increasingly wanting to match portfolio manager objectives and strategies with their own, a commentary is a great way to explain how your fund is positioned for the future.
Inform your reader about your trading activity during the period and fund’s positioning at the end of the period to highlight how you are working to meet the fund’s objectives. Convey how you have been deploying capital within the fund’s strategic framework to meet its stated risk/reward objectives.
We believe these are some of the most the important elements of an informative and useful portfolio manager commentary. Your commentaries can act as great opportunities to showcase the performance of your fund, explain why it has either outperformed or underperformed its benchmark, and tell your reader how the fund is positioned for outperformance in the coming period.
Need help producing your commentaries, videos, or podcasts? Contact us at 1.844.243.1830 or info@ext-marketing.com.
5 reasons why investment commentaries aren’t so bad
Here’s a widely held belief: investment commentaries get in the way of the more high-profile initiatives that first attracted you to marketing.
In many respects, that’s true. But we think there’s more to the story. While working on investment commentaries won’t likely lead to any awards, it’s a great way to learn about the industry and become a better marketer.
1. Learn more about the industry
Working on investment commentaries is a crash course on the investment industry.
For people newer to the industry, you’ll learn about management styles, benchmarks, how the markets work, the impact of macroeconomics and much, much more.
For more experienced industry professionals, involvement in investment commentaries makes regulatory changes a part of your day-to-day work. Admittedly, not the most exciting proposition. This regulatory awareness, however, helps you think about broader industry trends and how they may impact your profession in the future.
“Regulatory awareness, however, helps you think about broader industry trends and how they may impact your profession in the future.”
2. Expand your network
Every company has a different group of people working on investment commentaries. Trust us, there’s no universal template.
And while that leads to some practical challenges, it presents a great opportunity – you’ll get to work with a diverse group across your company, from legal and compliance to marketing, investments and product.
There’s a little piece of irony here. Investment commentaries appear to be a low-profile task, but they’re very high profile among certain teams within your organization. So, if you want to grow your network, working on investment commentaries is a good way to go about it.
“Investment commentaries, such as MRFPs, appear to be a low-profile task, but they’re very high profile among certain teams.”
3. Work under pressure
Month after month, quarter after quarter, year after year, disparate teams all across the world pump out investment commentaries. The timelines are tight and effective communication is essential to get the job done right.
Calm, clear thinking is required from everyone on the team, as is a commitment to detail orientation.
These “soft” skills flourish under the ticking clock of an investment commentary project and they transfer over to all other marketing endeavours that you’ll take on.
4. Write for a new audience
If you’re a financial services copywriter, investment commentaries may open your work up to a completely new audience.
Whereas most marketing materials are geared toward retail investors, a significant number of institutional investors (and other distribution channels) will read about your firm’s solutions through investment commentaries.
Institutional writing is higher stakes and the writing can be snappier and more technical. It also provides you with the opportunity to include some of that jargon you try to avoid when writing for a retail audience.
“Institutional writing is higher stakes and the writing can be snappier and more technical.”
5. Focus on process
Investment commentaries are among the most process-driven financial services marketing projects.
We write, edit and project manage investment commentaries for a significant number of the world’s largest financial services firms. As such, we’re always learning about new ways to improve our clients’ processes.
Do you want to produce better investment commentaries? We can help. Contact us at 1.844.243.1830 or info@ext-marketing.com.
Prepping for commentary season – get your facts in order
Investment commentaries involve content from a wide variety of sources including your communications, product, investments and fund accounting teams. They also need numerous reviews and approvals, and have non-negotiable timelines.
That’s why investment commentaries can be a stressful project for many people. To make the process as streamlined as possible, it helps to compile some key information in one document – and as early in the process as possible.
“Compile … key information in one document – and as early in the process as possible.”
It’s worth taking the time to create a reliable reference list that includes full and correct information for things that need to be precise, or that need to be checked often.
The Fund Info List
While this is not an exhaustive rundown, here are some essential elements of the Fund Info List:
Use exact fund names. Is it Short Term Bond Fund or Short-Term Bond Fund? Global Income Growth Fund or Global Income and Growth Fund? Be sure to update this list with any new mandates or name changes. And don’t forget that the Simplified Prospectus is often the best place to confirm full names.
Be precise with benchmark names. Index names, such as the BofA Merrill Lynch 1-3 Year Treasury Index, are very difficult to check against external sources as every company seems to apply its own style. Total return indexes, which are sometimes shortened to TR, are also notoriously inconsistent.
Keep an exact list of portfolio manager and sub-advisor names, and update it regularly, since sub-advisors do change fairly often and companies’ legal names do as well.
Again, the more exact the list of underlying funds, the easier it will be to cross-reference your information. If your company offers Funds, Classes and Pools, this becomes an even higher priority.
Track the inception date of funds. This information will help your writers know how to position the attribution information in the commentaries.
What to do with your Fund Info List
You’ve put together all correct info. Now what?
- Share this list with your writers, editors, reviewers – and anyone else who may need to use or check this kind of information. Be careful to allow only a few individuals at your company to update this list when necessary, as it loses its value if it’s not reliable
- It’s a good idea to include your Fund Info List in (or in the same folder as) your company style guide
- If you also produce material in another language, a version of this list with your company’s chosen terminology will be invaluable for translation
“Be careful to allow only a few individuals at your company to update this list when necessary, as it loses its value if it’s not reliable.”
And remember: it’s not just the facts but also the language you use that matters! So, if using the right language is a concern, read Using plain language in your financial writing.
We specialize in producing high-quality investment commentaries for some of the world’s largest financial services firms and we can help your company too.
Contact us today at 1.844.243.1830 or info@ext-marketing.com to get your investment commentary process running smoothly and efficiently.
Market outlook 2018
January’s coming to an end and we have just one question: did you read our Market outlook 2018?
If you haven’t yet, check it out here. In it, we cover U.S., European, Canadian and Chinese equity markets and economies. We also look at fixed income markets.
While predicting the future is a fool’s game, we couldn’t resist making a few bold claims along the way. We talk about:
- The next phase of the Canadian housing boom
- The unexpected result of legalizing marijuana
- Is “this time it’s different” the right approach to the U.S. information technology sector?
- Central bank decisions … and indecision
- The European political situation
- Energy and materials sector volatility
- Interest rates, inflation, flights to safety, corporate headwinds and more
Read our Market outlook 2018 today!
Contact us at 416.925.1700, 1.844, 243.1830 or info@ext-marketing.com for financial marketing and investment commentary support.
Read more:
Using plain language in your financial writing
If you write content for the financial services industry, you likely write for a variety of audiences.
Some of the people who read your content may be advisors. Others may be new investors who are still learning the basic concepts of investing.
You can make your content more accessible to everyone by following a few plain language principles.
The truth about plain language
Some people think that plain language is about “dumbing things down.” It’s not. Plain language is about expressing yourself clearly and concisely without being condescending or making anyone feel dumb.
What might make someone feel that way? Having to look up every fifth word they read in the dictionary or giving up on an article because it’s too dense and exhausting.
Plain language is about expressing yourself clearly and concisely without being condescending or making anyone feel dumb.
Imagine a doctor who speaks like a medical textbook. Every other word they say is over your head and, despite asking good questions, you give up on having a meaningful conversation.
You know you’re an intelligent person. But you’re going to feel much less intelligent if your doctor insists on saying “Choledocholithiasis” instead of “gallbladder stones” and sighs when you ask them what that means. Especially since there’s no reason for a doctor to avoid using a common and easily understood term like “gallbladder stones.”
Three elements of plain language
Without “dumbing” anything down, you can get your message across to a broader audience by focusing on these three things.
1. Organization
Break your article into chunks so readers can scan it quickly and easily. This means using heads and subheads relevant to what you’re about to say.
Make sure each paragraph focuses on a single topic. If you move onto a new topic, move onto a new paragraph, too. Readers find it easier to digest one main thought at a time.
2. Sentence and paragraph length
Try to keep your sentences under 30 words and limit each paragraph to three to five sentences. If you have a long sentence that can’t be broken up, try putting it into bullet points.
3. Word choice and style
Write in a conversational tone and use active voice as much as you can. Avoid industry jargon that most people outside of your industry won’t understand, and delete unnecessary words.
Avoid industry jargon that most people outside of your industry won’t understand.
Choose familiar words over more obscure words, but don’t avoid long words that would be easily understood by your audience just because they’re long.
Take a look back through this post and you’ll see that we’ve used some long words, but we’re confident our audience will be fine with this.
A word on design
There’s a strong design element to plain language, which might be something you don’t have much control over. However, using a readable font and including lots of white space will make your content easier to read.
Plain language in action
Here’s a short before-and-after example of the three elements of plain language in action.
Before
“Despite a year filled with market and operational headwinds, much positive feedback was given to us by clients in recognition of the merit of our customer service, superior attention to detail and unyieldingly honest marketing campaigns.”
After
“Despite a challenging year, our clients told us they appreciated our commitment to customer service, attention to detail and honest marketing campaigns.”
What we did
- Kept the sentence under 30 words
- Used active voice
- Deleted industry jargon
- Deleted unnecessary words
Looking for plain language expertise? Contact us at 416.925.1700, 1.844.243.1830 or info@ext-marketing.com.
Read more:
https://ext-marketing.com/commentaries-articles/writing-for-investors-avoid-industry-jargon/
Writing for investors? Avoid industry jargon
Like most highly specialized industries, financial services has a unique set of words and phrases that mean little to people outside of the industry.
That’s essentially the definition of industry jargon, and it isn’t always a bad thing. For example, when you’re writing or speaking to other professionals within your industry, those industry-specific words and phrases can sometimes be the fastest and most effective ways to communicate.
But when you’re sharing information with anyone who doesn’t work in financial services, including investors, industry jargon can be confusing at best and completely meaningless at worst. Here, we’ve chosen five terms to avoid when writing for investors.
1. Headwinds/tailwinds
To people outside financial services, headwinds and tailwinds are something they experience when they’re on an airplane. When they fly west, they have to deal with headwinds, so their flight takes longer. When they fly east, they benefit from tailwinds, so their flight is a bit quicker.
Hmm… that must mean that headwinds are bad and tailwinds are good, right? Usually, but your reader had to make a lot of connections before they could figure out what you were trying to say. Why not say “challenges” or “benefits” if that’s what you mean? Better yet, be specific and explain exactly what challenges or benefits you’re talking about.
Be specific and explain exactly what challenges or benefits you’re talking about.
2. Secular
This is another term that takes on an entirely different meaning outside of the financial world. It generally means the opposite of spiritual or religious. If that’s what you’re writing about, “secular” is absolutely the right word to use. If not, the term you’re probably looking for is “long term.” To avoid any confusion, keep it simple.
3. Upside potential/downside risk
For people who don’t have in-depth knowledge of banking and investments, these terms lack any meaning.
We understand that it’s much simpler to write “upside potential” than it is to explain that you expect a certain stock price to increase over the short term and to tell your readers why. But if your audience doesn’t understand what you’re writing about, why write it at all? We would say the exact same thing about the term “downside risk.”
If your audience doesn’t understand what you’re writing about, why write it at all?
4. Alpha and beta
When an investor reads about a fund’s performance, they typically care how that fund performed relative to a benchmark index. If a fund had higher returns than the index, just say so. There’s no reason to throw the word “alpha” in there.
The word “beta” is a bit different, because it has a very specific meaning when you’re talking capital asset pricing models, and there’s no other word that quite works. If you have to use “beta” in that context, consider defining it for investors.
However, we find that “beta” is often used to mean risk or volatility in general. If that’s what you mean, either of those words would be a much better choice.
5. Underlying fundamentals
This one makes our list because it can mean so many things that it becomes almost meaningless to investors. If you’re writing about a certain company, are you focusing on its revenues, earnings, assets, liabilities or all of the above? The defining “fundamentals” of a given sector could range from pricing structure to regulatory issues to supply versus demand.
The term gets even fuzzier when you’re talking about the underlying fundamentals of a broad market. Avoid this term completely and explain exactly what factors you’re concerned about or encouraged by.
This list is far from complete, but it’s a good place to start if you’re looking to make your writing more investor-friendly.
Looking to make your investment commentaries more accessible to investors? Contact us at 416.925.1700, 1.844.243.1830 or info@ext-marketing.com.
Read more:
https://ext-marketing.com/commentaries-articles/5-reasons-investment-commentaries-arent-bad/
They’re ba-ack! Are you prepared for year-end investment commentaries?
Year-end investment commentaries are coming. And they’ll stop for no one!
While we’re just having a little fun with the title, we do produce 1000s of commentaries every year. So, we know the pressures you face.
Investment commentaries involve content from many sources, need numerous reviews and approvals, and have non-negotiable timelines.
To make the process as streamlined as possible, it helps to compile some key information in one document – and as early in the process as possible. We recommend starting today. It will help remove a lot of the stress that comes with commentary projects.
Create a fund info list
It’s worth the time to create a reliable reference list that includes full and correct information for things that need to be precise, or that you need to check often. Over the years we’ve learned to include:
1. Fund names
Use exact names – is it Canadian Small Cap Fund or Canadian Small-Cap Fund? Be sure to update this list with any new mandates or name changes (TIP: a Simplified Prospectus is often the best place to confirm full fund names).
2. Benchmark names
Precision helps here too. These are difficult to check against external sources. Even the index providers themselves can use different names on their websites, so your company’s style should be followed.
3. Portfolio manager and sub-advisor names
Keep an exact list and update it regularly, since sub-advisors change often and companies’ legal names do as well.
4. Underlying funds
The more exact the list, the easier it will be to cross-reference your information. This becomes more important as your firm launches more fund-of-fund and managed solutions.
5. Inception date
This information will help your writers know how to position the attribution information in your commentaries. Again, if your firm is expanding its product shelf, you can avoid wasted time working on commentaries that should not have performance info.
Remember your translators
If you produce investment commentaries in more than one language, a version of this list with your company’s chosen terminologies will be invaluable for translators. This document could literally save your firm hours of work.
Next steps
Share this list with your writers, editors, reviewers – and anyone else who may need to use or check this kind of information. While everyone should be able to see this document, a much smaller group should be able to edit it.
A fund info list is powerful when it is reliable. If not, it’s about as useful as an old TV from the 80s.
Let us help you produce high-quality investment commentaries. Contact us at 416.925.1700, 844.243.1830 or info@ext-marketing.com.
Read more:
7 time-saving investment commentary tips
Are you involved in the portfolio manager/regulatory commentary process? By that we mean MRFPs, financial statements, monthly, quarterly and semi-annual commentaries, and annual reports. If so, you know that timelines are tight and extra rounds of review can derail the project.
To help you make the process as efficient as possible, we’ve put together a list of seven tips that could save you hours. They’re easy to implement and you’ll see results immediately.
1. Know your benchmarks
A fund’s official benchmark may not be the one that your portfolio manager used during the period, especially if it is sub-advised. Getting that right before reviews is an easy win. If you’re wondering what else you may need to document before the process starts, here are some other facts to get in order.
2. Heads up!
Let everyone – portfolio managers, analysts, project managers and your compliance team – know their timelines well in advance, and then remind them again a few days before the process gets underway.
3. Use the right language
Don’t send copy to compliance that won’t be accepted. That means removing investing jargon and overly technical terms like “risk on/risk off,” “headwind/tailwind,” “hawkish/dovish” and “when rates backed up.” We can help you find suitable alternatives that an average investor would understand, check this post out for more jargon to avoid.
4. Think about repetition
Does every single fund need a different outlook? It’s important to spend some time on that question because if you choose “No” you could cut down on a significant amount of work by repurposing copy.
5. Shorter is better
Tight copy that gets to the point will always win. Your readers will appreciate your brevity if it helps them get a better picture of what happened over the period. Here are some more tips on simplifying your commentary writing.
6. Know your reporting period
Six-month marketing commentaries and MRFPs can be a problem because investment teams are more familiar with quarterly and annual reviews. In your communications leading up to the project, explain the time period in bold typeface.
7. Create a style guide
Does your firm write sector names with an uppercase or lowercase letter (e.g., the Energy sector or the energy sector)? Does your firm use a serial comma or not? If everyone is on the same page, reviewing will take less time. Here’s how to strengthen your brand with a style guide.
There you have it: seven simple ideas that can save you hours. We’ll return to this topic from time to time throughout the year, so keep checking our blog and social media for more insights.
If you want to improve your commentary process, contact us today at 416.925.1700, 1.844.243.1830 or info@ext-marketing.com.
Read more:
https://ext-marketing.com/commentaries-articles/outlook-comments-mrfps-required/
Are “outlook” comments in MRFPs required?
At least every six months, communications, product and investments teams gather to produce MRFPs for mutual funds and ETFs.
While it’s unlikely that MRFPs are your most-read documents, it’s important to deliver on what’s required – to keep your current and future investors informed about the issues that affect their investments and to meet your regulatory requirements.
Should you or shouldn’t you include “outlook” comments in your MRFPs? The regulatory language is vague, and it puts the onus squarely on those responsible for producing the MRFPs.
In this article, we refer to “National Instrument 81-106 Investment Fund Continuous Disclosure” (“NI 81-106).
NI 81-106: Language specific to outlook comments
NI 81-106 is a big document. Even though it’s a little intimidating, it’s worth reading a few times. There are two sections that we want to focus on for this article. The first is 2.4 Recent Developments:
“Under the heading ‘Recent Developments’ discuss the development affecting the investment fund, including … known material trends, commitments, events or uncertainties that might reasonably be expected to affect the investment fund.”
The second is a little further down in the document, in INSTRUCTIONS (1):
“Preparing the management discussion necessarily involves some degree of prediction or projection. The discussion must describe anticipated events, decisions, circumstances, opportunities and risks that management considers reasonably likely to materially impact performance. It must also describe management’s vision, strategy and targets.”
So far, we believe the NI 81-106 is clear on the matter: include outlook comments. But the vagueness arrives quickly.
Watch out for promissory language
Immediately after the instructions above, we find this sentence:
“There is no requirement to provide forward-looking information.”
By this, we take it that regulators are referring to performance-specific comments. Your portfolio managers and sub-advisors should not promise performance in their outlook comments, and regulators are well aware of that.
“Forward-looking information,” however, could also encompass anything that refers to the future.
It’s up to you
MRFPs were created in the spirit of keeping Canadians better informed about their investments.
If you include outlook comments in your MRFPs, write about possible events that may affect fund performance and future activity in the fund. For example, a corporate bond fund will be affected by changing interest rates. That might be obvious for people in the investment industry, but may not be quite as obvious for investors.
If you don’t include outlook comments, create a brief business case for why you chose not to do so. If your firm believes there is a business risk to including these kinds of comments, have an explanation as to why. Also, be sure to highlight that your outlook comments won’t deliver on the regulators’ intentions. Keep this on hand in case you’re asked about your choice.
More resources
- Check out our ebook on commentaries, Your commentary prep-book: Get ready for crunch time – in no time
- We share our commentary best practices on our blog, check them out here
- NI 81-106 (page 44 is a good place to start)
- Ontario Securities Commission, Latest instruments, rules and policies
- Canadian Securities Administrators, Letters, statements and other reports
Ext. Marketing can help
We produce thousands of monthly, quarterly, semi-annual and annual commentaries – many of them MRFP commentaries – every year.
Our clients are among the world’s largest and most successful investment firms, and our daily interactions with our clients have given us a unique perspective – and dozens of best practices – for writing, editing, designing and project managing portfolio manager commentaries. We can help you produce better commentaries too.
To start creating better, faster and even cheaper commentaries, contact us today at 416.925.1700, 844.243.1830 or info@ext-marketing.com.
Read more:
https://ext-marketing.com/commentaries-articles/7-time-saving-investment-commentary-tips/
Why MRFPs are so important
The Management Report of Fund Performance (“MRFP”). It’s a report that’s often, and quite appropriately, viewed as a regulatory document. But it can be so much more.
MRFP commentaries can also be a story from the fund’s past to help explain its future.
You know the format: the macroeconomic environment, performance versus the benchmark (including contributors and detractors), trading activity and current positioning. All of these are vital components from a regulatory standpoint.
Share vital information
But maybe more importantly, they are also vital pieces of information for advisors and investors. Advisors want to ensure that portfolio manager objectives and strategies are aligned with their own and those of their investors. Certainly not an unreasonable ask.
Advisors want to ensure that portfolio manager objectives and strategies are aligned with their own and those of their investors.
With so much choice in the industry these days, advisors are tuning into the objectives, strategies and processes of portfolio managers to ensure their recommendations are the right match for their clients.
Speak directly to investors
How can you help inform advisors and investors? By looking at MRFPs not only as regulatory documents but also as a chance to speak directly to investors.
Whether your fund outperformed or underperformed, if you give investors a well-integrated story about why the fund performed as it did, you can build a strong and long-lasting relationship with the investor.
You can build a strong and long-lasting relationship with the investor.
So put additional effort into it and explain what sectors, geographic regions and individual holdings contributed to and/or detracted from performance.
More importantly, explain why these sectors, regions and holdings performed the way they did. Those are the insights investors can’t get elsewhere but should always have available in their funds’ MRFPs. Including this information shows investors that you are working towards your objectives, following your strategy and executing on your process.
At their most basic level, MRFPs are regulatory documents. But they are also an opportunity to speak directly to investors. Don’t pass on the opportunity to tell these investors why your fund is the right option for them.
For investment commentary support (including monthly and quarterly commentaries, as well as MRFPs), contact us today at 416.925.1700, 844.243.1830 or info@ext-marketing.com.
Read more:
When technical terms attack: Avoiding jargon in investment commentaries
Sometimes jargon is useful, and can be used as an efficient way for investment professionals to discuss obscure and complex topics with precision.
More often though, jargon is used as a mental and verbal shortcut. Instead of thinking about what we really mean and using clear and unambiguous language to say it, we use jargon, even when talking to non-specialists – in this case, an average investor.
Instead of thinking about what we really mean and using clear and unambiguous language to say it, we use jargon. It’s a verbal shortcut.
At its worst, the result can be incomprehensible writing.
For example, here are a few jargon terms that often pop up in investment commentaries, along with some ways to avoid using them:
Alpha
Instead of “negative alpha,” it’s easier for the average reader to understand that “the fund underperformed relative to the benchmark.”
Bottom-up
When describing this kind of investment style, try “focusing on a specific company, rather than an industry or economy.” Likewise, don’t assume that your reader will understand “momentum” without explanation.
Fundamentals
Instead of discussing “the company’s strong fundamentals,” try “the strength of the company’s financial statements and management team.”
Headwinds
This term is popular in the investment industry, but try “challenges” instead – or better yet, name the particular challenges you mean. Similarly, instead of “tailwinds,” try a term such as “favourable conditions.”
So are we saying you should never use technical terms in your writing? No, of course not. But think hard about what you’re trying to say and the best way to say it.
Think hard about what you’re trying to say and the best way to say it.
Sometimes only a technical term will do. If that’s the case, define it clearly up front. For example, you will probably have to discuss duration when writing about fixed income funds, so explain that it is a measure of the interest-rate sensitivity of a bond.
Your investment commentaries will be livelier and more readable if you use technical terms sparingly.
Sometimes it takes a few more words to say what you really mean, but getting the point across clearly is worth it.
If you want support for your investment commentaries, contact us at 416.925.1700, 844.243.1830 or info@ext-marketing.com.
Read more:
https://ext-marketing.com/commentaries-articles/prepping-for-mrfp-season-get-your-facts-in-order/
https://ext-marketing.com/commentaries-articles/5-reasons-investment-commentaries-arent-bad/
Good, bad and ugly: The changing rules of grammar
Since the dawn of time – or at least since the first cavemen started chiselling on stone tablets – people have debated what constitutes proper use of language. Fact is, grammar is fluid and as times and trends change, writers adapt the rules – for better or worse. Here are five examples of grammar faux pas that are now generally accepted.
1. Using certain nouns as adjectives
As an example, it used to be that “American” was the adjective and “U.S.” (or “America”) was the noun. However, it’s now accepted to say something like “The U.S. financial system is gaining stability.”
More recently, many people are using “woman” as an adjective – e.g., “This firm has a high percentage of woman portfolio managers.” Of course, “female” is the correct adjective. Even worse, some writers use “woman” and “female” interchangeably as adjectives in the same piece, without rhyme or reason. Double whammy.
2. Splitting infinitives
Teachers used to implore their students never to split infinitives. Then the TV show Star Trek talked of the mission “to boldly go where no man has gone before,” and the split infinitive lost its stigma. Other languages like French and Italian keep their infinitives as one word, so no worries about splitting those.
3. Ending a sentence with a preposition
Purists may cringe when people finish sentences with a preposition, but most anyone else won’t even blink at a sentence such as “That’s a big hole to climb out of.” Sometimes it’s just more pleasing to the ear than to say “That’s a big hole out of which to climb.”
4. Using the plural “their” in relation to singular nouns
Practicality was the impetus behind this morphing grammar rule, as it’s cumbersome to write – and worse to read – a sentence like “When an individual squanders his or her money, he or she will find that tough times will soon beset him or her.”
5. Using certain adjectives, instead of nouns, in a compound adjective
This one’s hard to explain but examples should help. While it’s grammatically correct to say “Canadian company” or “German scientist,” introducing a second preceding adjective changes the rules.
Although common, saying “a Canadian-based company” or “a German-born scientist” is wrong. The company is not “based in Canadian” and the scientist was not “born in German.” Correct usage is “Canada-based company” and “Germany-born scientist.” Not sure why people tend to do this with countries but not cities. For instance, you’ll see “Toronto-based writer” but never “Torontonian-based writer.”
Language can be so much fun!
We can help you write compelling – and accurate – marketing materials. Contact us at 416.925.1700 or info@ext-marketing.com.
Automated or custom portfolio manager commentaries? Why not both?
Fund companies used to have a writer sit down with a portfolio manager (PM) to hear how the PM’s fund did over the past reporting period, and then the writer would distill that information into a concise commentary for the PM to review and approve. Not anymore.
More and more companies are looking for alternatives to getting their marketing and regulatory commentaries written in a convenient fashion. Also, the large number and types of funds available today makes the face-to-face approach nearly impossible, given the time constraints that PMs have to deal with.
And, because fund companies have to create these commentaries quickly as a result of regulatory or other delivery requirements, in-house copywriting resources are often not an option for this volume of work.
The answer? Combine automation tools and best practices with a professional commentary writing service. Here is how to break it down:
What to automate and what to keep custom
From experience, we’ve found that combining automation and customization at specific points in the commentary process is the best way to alleviate pressure on your PMs, while also meeting all of your regulatory and compliance needs.
There are lots of ways to use technology to streamline the commentary process. For starters, data can be pulled from attribution reports to create individual commentary shells for each fund mandate.
Ext. Marketing Inc., for example, uses custom reporting templates that PMs or their analysts fill out to reduce the amount of time required by PMs to complete their commentaries. These commentaries are written, edited and proofread by experienced and knowledgeable financial services writers.
Outsourcing can improve your process
Outsourcing this work to a professional financial services commentary provider that can leverage technology to streamline the commentary process – and provide a well-crafted commentary that maintains the voice of the PM – is a great option. Outsourcing:
- Often produces commentaries faster than using in-house resources
- Expands the ability to research and add the “whys” after attribution information has been determined
- Includes editing as part of the process, so commentaries are returned to clients cleaner
- Completes engaging macroeconomic/market review and outlook sections, before the period has ended if required
- Ensures all regulatory requirements are met
With some strategic thinking about where automation and customization can improve your process, PM commentaries no longer have to strain you and your company’s resources.
Improve your PM commentaries by contacting us at 416.925.1700 or info@ext-marketing.com.
What makes a great translator?
Financial services translation poses some interesting challenges for marketers – technical terms and time constraints being just two among many. In this post, we talk about the skills that great translators possess and we share some tips on choosing the translator that’s right for you.
Core skills of a great translator
1. Technical knowledge specific to your field
It’s not just enough to be a native speaker. A great translator must have an intimate knowledge of your industry … and its idiosyncrasies. Not only is financial services filled with technical terms but it is also bursting with jargon that only an experienced translator can handle.
2. Critical thinking and passion
These are two sides of the same coin. Critical thought without passion may result in overly technical language when translated, while passion without critical thinking may lead to engaging translations that miss the mark. Great translators have both.
3. Accomplished composition
A great translator’s output is written well, understood easily by the right audience and captures the meaning of the original copy. When certain English terms (e.g., idioms, product names, clever plays on words, etc.) just don’t translate well, the translator will have to adapt. This is definitely one of the more “writerly” skills, and one that makes translation closer to an art than a science.
4. Flexibility
It’s unfortunate but it happens again and again – your translators will have to work under a time crunch. Great translators can work under tight timelines, and they can make adjustments on the fly as work is sent their way.
How to find a find a great translator
1. Create a shortlist
Ask experienced colleagues and your peers for recommendations. There’s really no better way to find out who has financial services experience and who can be trusted to deliver high-quality work.
2. Screen them
Now we’re getting into the particulars. We think that the following three criteria will help you further refine your list: certification, experience and fees. Rate these three criteria in order of importance (depending on your needs, one may be of much greater value to you than another), and then move on to your next step.
3. Translation test
One test should do the trick because you don’t want to take up too much of your – or your potential translator’s – time. How technical should the language be? We think that your goals should not be to stump your translator. Rather, you want to test all four of the skills mentioned above. So, some technical language is ideal, though a PhD level thesis may be going overboard.
Contact Ext. Marketing Inc. today at 416.925.1700 or info@ext-marketing.com to benefit from great copy in any language.
Commentary/MRFP roundup: June 2015
Commentary and MRFP season is in our sights. Here are some writing, editing and process resources to get you ready for the July rush.
Articles
Jargony phrases – and ways to keep them out of your commentaries
We all tend to use some jargon in conversation. But it’s best to keep that jargon – including highly technical terms – out of portfolio manager commentaries.
If you’re having trouble finding the right words to describe financial concepts without using jargon, don’t fret. We’ve got investor-friendly alternatives that you can use.
Rounding for non-math types
The recent demise of the penny gave us all a refresher course on rounding.
Most of us know that one to four rounds down and five to nine rounds up, but there can be some surprising pitfalls when dealing with the kinds of numbers that are common in financial services marketing, especially in commentaries and reports.
When technical terms attack: Avoiding jargon in financial commentaries
Sometimes jargon is useful, and can be an efficient way for investment professionals to discuss obscure and complex topics with precision.
More often though, jargon is used as a mental and verbal shortcut. Here are some common jargon terms … and ways to make them investor friendly.
Free ebook
Start off your next commentary period strong with our new ebook
Do you work on fund commentary projects such as monthly, quarterly or MRFPs? If so, “Your Commentary Prep-book: Get Ready for Crunch Time in No Time” is for you.