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ETF Provider FlexShares Caters to Financial Advisors


Northern Trust’s FlexShares has found that by better understanding the way average financial advisors are changing and adapting to the evolving industry, exchange traded fund providers can become more successful in creating relationships.

Marie Dzanis, Senior Vice President and Head of Exchange Traded Funds Sales and Servicing at Northern Trust FlexShares, believes that a fund provider has to be smart about distribution channels to be able to compete in a maturing ETF industry.

She was happy to share her favorite quote by U.S. politician Adlai E. Stevenson:

“On the plains of hesitation lie the blackened bones of countless millions who at the dawn of victory lay down to rest, and in resting died.”

Dzanis believes that the industry needs to reach out to advisors to create relationships that would help provide beneficial investment opportunities and strategies.

“The average advisor is changing and we need to change the way we connect with advisors,” Dzanis said in an interview.

For instance, there are generational concerns and lifestyle changes to consider – workers are pushing their retirement dates further out, or successful millionaires in their mid-twenties.

Looking at the generational gap, baby boomers and generation Y are making different investment decisions. Baby boomers are more apt to accept referrals and expert recommendations. Meanwhile, generation Y investors are use to research and the digital age, relying on just the facts.

Additionally, Northern Trust recently came out with a white paper that discusses the growing wealth among women and the changes the advisor community will have to make to meet the shift in wealth. Advisors will have to adopt a more customized approach to be effective at targeting and closing executive women.

“Surveys indicate that these women want authenticity in their financial advisors,” Dzanis wrote in the white paper. “They want advisors who are able to connect with them on a personal level and who can provide services, resources and products that will have a meaningful impact on their lives.”

The FlexShares ETF suite includes a small but but targeted approach to market exposure. The provider offers a line of ETFs based off Morningstar research. For instance, FlexShares Morningstar U.S. Market Factor Tilt Index Fund (TILT) is an alternative to market-weighted equity products, leaning toward small-cap and value stocks to potentially enhance returns.

Moreover, the sponsor has a line of “quality dividend” index funds that utilizes a “quality factor” to select the best dividend yield opportunities for given market segments.

FlexShares also offers a couple of target-duration Treasuury inflation protected ETFs that help provide targeted exposure through changing interest rates and economic cycles, along with a variable income fund that includes short-duration fixed-income assets to help diminish the effects of rising interest rates.

For more information on the ETF industry, visit our current affairs category.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.