Investor Economics Insight February 2021

Product Development: Diversification Is the Name Of the Game
Product development is one of the main mechanisms through which asset managers can rapidly adapt to changing advisor and investor preferences and ensure their continuing relevancy in today’s market. Beyond tactical priorities, however, the need to adapt product shelves to the new economics of the business has been a major priority for many fund manufacturers. Products with different degrees of activation; developments in artificial intelligence applied to portfolio management; strategies that deliver beta exposure with constant rebalancing and beyond are all expected to continue to keep product developers busy in the near future.

The February research feature of Insight presents the key trends in product development over the course of 2020 and explores what asset managers have been releasing in the stand-alone mutual fund, mutual funds of funds (MFoFs), and ETF spaces. New fund launches are examined by sponsor type and select notable ones are showcased. We also revisit the liquid alternative space two years after its official debut in Canada’s retail segment. The Trendlines feature highlights developments in the ESG space in further detail and discusses how sustainability in investing has evolved in recent years.