Eric Hewitt, Chief Investment Officer and Head of New Product Development, SS&C Alps Advisors joined Keith Black, Managing Director of RIA Channel to discuss today’s market environment and key trends in the advisory industry.
2023’s fall of Silicon Valley Bank and fears around the solvency of the entire regional banking system, drew early comparisons to The Great Financial crisis. The good news, is that this time around, banking regulators worked quickly and competently to prevent a disastrous domino effect. One result, explains Hewitt, may be that regional banks constrain lending for some time, which can slow credit availability and economic growth. Rather than being an extended recession or rolling crisis, this may just be another normal credit cycle. Hewitt describes several themes that may be compelling investment opportunities, including companies involved in the energy transition theme and those that can pass along price increases, especially in staples, health care, and traditional energy and infrastructure. The reinvestment of equity dividends can also add value for investors.
From a product standpoint, Hewitt says that ultimately the advisory business is becoming much less investment-focused and much more goals-based. As client conversations shift from investment performance to client goals, such as retiring with income or growing generational wealth for their family, factors like tax efficiency, cost, flexibility and customization at scale are increasingly important to advisors.
Resources:
Preparing For The Energy Transition – Infrastructure